In 610 A.D., Muhammad ibn Abdallah, a forty-year-old man from a prosperous merchant family in Mecca, repaired to a cave on nearby Mt. Hira to meditate–a retreat he had made many times. That year, though, his experience was different. An angel appeared and seized him, speaking to him the words of God. Muhammad fell to his knees and crawled home to his wife. “Wrap me up!” he cried. He feared for his sanity. But, as the voice revisited him, he came to believe that it truly issued from God. It called on him to reform his society. Poor people were to be given charity; slaves were to be treated justly; usury was to be outlawed. Muhammad’s tribesmen, the Quraysh, were polytheists, like most people in the Arabian Peninsula at that time, but this God, Allah, proclaimed that he was the only God. He was the same deity that the Jews and the Christians worshipped. Jesus Christ wasn’t his son, though. Christ was just a prophet, like the prophets of the Old Testament. Their word was now superseded by Muhammad’s, as their creeds were supplanted by this new one, Islam.

When Muhammad started preaching in Mecca, people saw him as a harmless crank, but as he gained followers he began to be regarded as a menace. Mecca was an important trading hub, with rich merchants. Muhammad’s God forbade all ostentation. Furthermore, if, as he instructed, the pagan idols were to be discarded, that would mean no more revenue from their shrines. In 622, Muhammad and his followers were driven out of Mecca. They fled to Yathrib, which became known as Medina, and from there they warred with their native city. In the beginning, Muhammad’s treatment of his fellow-monotheists the Jews and the Christians was conciliatory, but new religions do not normally establish themselves with the help of older religions. The local Jewish tribes conspired against him. After a decisive battle in 627, Muhammad had seven hundred Jews beheaded in Medina’s central market. In 630, he and his men took Mecca. Muhammad ordered the destruction of the three hundred and sixty idols around the city’s great temple, the Kabah. He proclaimed the supremacy of Islam, and reportedly sent messengers to the rulers of Persia, Byzantium, Yemen, and Ethiopia bidding them to convert. According to his biographer Karen Armstrong, he spent his few remaining years trying to establish peace, sometimes over the objections of his lieutenants.

Soon after Muhammad’s death, in 632, the record of what God had said to him was collected in the Koran, and his contemporaries’ testimonies about his life were gathered in the Hadith. At the same time, Islam expanded, with a speed unique in history. One of the obligations imposed on the faithful by the Koran was jihad, or struggle. This has been translated as “holy war,” and there are passages in the Koran to support such a reading, notably the recommendation that Muslims kill enemies of the faith: “Fight against them until idolatry is no more and Allah’s religion reigns supreme.” But just a few paragraphs later the Koran makes the opposite decree: “There shall be no compulsion in religion.” Some interpreters of the Koran–particularly in recent years, when holy war has become a matter of public alarm–have argued that “jihad” actually means spiritual combat, every Muslim’s fight within himself against the temptations of evil. I don’t know why a book that was collected, rather than composed, should have to be internally consistent, or why a religious document that originated within a nomadic society in the seventh century and includes such things as the moon splitting in two should be asked to conform to post-Enlightenment thought. The Bible also contradicts itself, and has water turning into wine. Such matters are a problem only for literalists. As for slaying one’s enemies, this is enthusiastically recommended in Psalms (“Happy shall he be, that taketh and dasheth thy little ones against the stones”), as it is in many premodern writings.

In any case, however much Muhammad’s immediate successors may have struggled with their souls, they also, in the eighty-some years following his death, conquered Syria, Egypt, North Africa, Anatolia, Iraq, and Persia. By the beginning of the eighth century, Muslim forces stood at the northwest corner of Africa. There, only the Strait of Gibraltar, nine miles wide, separated them from the Iberian Peninsula. Iberia at that time was ruled by the Visigoths, a Christian people who did their best to wipe out other religions within their territory–Judaism, for example. There is some evidence that the Iberian Jews invited the Muslims to invade. In 711, they did so. The state that they established in Iberia, and maintained for almost four centuries, is the subject of David Levering Lewis’s “God’s Crucible: Islam and the Making of Europe, 570 to 1215″ (Norton; $29.95).

This book has to be understood in context, or, actually, two contexts. The first is post-colonialism, the effort on the part of scholars from the nineteen-seventies onward to correct the biases that accompanied and justified the colonization of eighty-five per cent of the earth by European powers between the sixteenth and the twentieth centuries. In that period, according to Edward Said’s 1978 “Orientalism”–the founding document of post-colonial thought–history-writing about the Near East and the Middle East was an arm of empire. Its goal was to make non-Western peoples seem uncivilized, so that European control would appear a boon. Since Said, much writing on Europe’s former colonies has been an effort to redress that injustice.

The other context in which Lewis’s book must be read is, of course, the history of terrorism, since the late nineteen-seventies, on the part of people claiming to be instructed by the Koran. When this started, most Westerners had little idea of what the Muslim world was. Harems, hookahs, carpets–that was about it. Nor, after the terrorist attacks, was it easy to catch up in any proper way, for, while there has been an outpouring of books on Islam in the past two decades, many of them were for or against it. A number of prominent intellectuals have denounced Islam. Other people have protested that the vast majority of Muslims do not support terrorism. Some historians have condemned not just the demonization of Islam but the West’s ignorance of the Muslim world–a failure now seen as political folly, not to speak of arrogance. Scholars went to their desks to testify to the glories of Islamic cultures. Salma Khadra Jayyusi, in the foreword to her magnificent anthology “The Legacy of Muslim Spain” (1992)–a collection of forty-nine essays describing not just the politics and the religion of Muslim Iberia but its cities, architecture, music, poetry, calligraphy, and cooking–calls the omission of Islam from the West’s story of civilization a “historical crime.”

Lewis’s book is part of that revision. The Muslims came to Europe, he writes, as “the forward wave of civilization that was, by comparison with that of its enemies, an organic marvel of coordinated kingdoms, cultures, and technologies in service of a politico-cultural agenda incomparably superior” to that of the primitive people they encountered there. They did Europe a favor by invading. This is not a new idea, but Lewis takes it further: he clearly regrets that the Arabs did not go on to conquer the rest of Europe. The halting of their advance was instrumental, he writes, in creating “an economically retarded, balkanized, and fratricidal Europe that . . . made virtues out of hereditary aristocracy, persecutory religious intolerance, cultural particularism, and perpetual war.” It was “one of the most significant losses in world history and certainly the most consequential since the fall of the Roman Empire.” This is a bold hypothesis.

The Muslims took most of Spain in a little over three years. The Visigoths had more men, but the Arabs were very skillful warriors, seeming to dance in front of the enemy, attacking, retreating, attacking again. Here and elsewhere, Lewis appears to see them as clever underdogs, David to Goliath, Muhammad Ali to George Foreman. He inventories the great sacks of gold and silver and precious stones that, together with vast numbers of slaves and young women (harem-bound), they sent back to their caliph in Damascus, the capital of the empire. Included in the shipments were the heads, pickled in brine, that they had removed from Visigoth grandees. In 714, they were just short of the Pyrenees, the northern border of Iberia. The peninsula was now theirs. They renamed it Al Andalus.

As news of the conquest spread, Arabs from the East streamed into Iberia, and they brought with them the conflicts brewing among them–above all, a nasty feud between northern and southern Arabs. The first twenty-two emirs (governors) of Al Andalus had an average reign of two years apiece. Stability, or as much of it as Muslim Spain ever had, began with the reign of Abd al-Rahman I, a Syrian-born prince who took over in 756 and managed to stay in power until his death, thirty-two years later. Rahman is the hero of “God’s Crucible.” Lewis loves him, and calls him by his sobriquet, the Falcon. Rahman was a firm ruler–he had taken his throne by force–but he was also a man of the people. Lewis describes him strolling about the capital city, Cordoba, in a white djellabah, without bodyguards, and preaching at Friday services in the mosque. Raised in a palace, he was an arts lover. It was he who built the Great Mosque of Cordoba, the most spectacular extant example of Muslim Spain’s architectural achievements. He also botanized, and imported to Spain its first date palms, its first lemons, limes, and grapefruit, as well as almonds, apricots, saffron, and henna. This of course was good for trade, which flourished during his time.

Accordingly, so did Spain’s cities, led by Cordoba, which under Rahman had an estimated population of about a hundred thousand. Lewis describes the metropolis that the emir left to his successors: “The qasr”–palace–”was new, completed just as the Falcon ordered the foundations laid for the Friday (Great) Mosque. Not many steps away were the public baths. Nearby was the central market, where basic commodities of bread, vegetables, fruit, oil, and lamb at regulated prices were upstaged by Persian carpets, Damascus metalware, China silks, fine leather and jewelry, slaves, and much else supplied on demand by the Muslim world economy. . . . The capital’s streets, following no particular pattern from the long wall beside the gray Guadalquivir River, linked neighborhoods where Jews, Berbers, Catholics and Orthodox, Arabs and muwalladun”–non-Arab converts to Islam–”lived as though in their own separate worlds. Sephardic apothecaries, Visigoth blacksmiths, and Greek surgeons offered services in these long, narrow arteries.” Orange and lemon trees in the public gardens perfumed the air. Outside the city, “the long Guadalquivir plain, abundantly irrigated by waterwheels, was carpeted with cereal plantations of wheat, rye, and barley, and olive trees forever.” You want to move there.

Rahman was the founder of Muslim Spain’s famous convivencia. Translated literally, the word means “living together,” in spite of differences, and this idea is the burning center of “God’s Crucible.” I think it is the reason that Lewis chose to write about Muslim Spain. He is not an Arabist. He is best known for a two-volume biography of W. E. B. Du Bois (1993 and 2000), which won two Pulitzer Prizes, one for each volume. But that book, if it is not about Arabs, is about racial justice, and it is for the furtherance of such justice that Lewis so admires Rahman. Nevertheless, as he points out, the convivencia had its limits. It was not just a humane policy–an act of obedience to the Koran (“There shall be no compulsion in religion”) and a way of being civilized–but also a matter of Realpolitik. Iberia was a ragbag of religious and ethnic groups. Tolerance, what we would now call multiculturalism, was more likely to hold them together than forced conversion. Furthermore, the convivencia never involved complete equality. In the early years, a number of restrictions were placed on Jews and Christians. They had to wear identification badges. They could not proselytize, and they were required to pray quietly. Their houses could not be taller than Muslims’ houses. Most important, they had to pay a heavy tax, called the jizya. In time, many of these rules (not including the tax) fell away. Jews, especially, were allowed to enter public service, as scribes, clerks, advisers. They taught the Muslims how to run a government, Lewis writes. The golden age of Al Andalus, he says, was also the golden age of Sefarad, the Sephardic Jews. But even those who did not have brilliant careers no doubt found badges and taxes preferable to forced conversion or death. Eventually, many Jews and Christians did convert–probably, in many cases, to avoid the tax. At the end of the eighth century, the vast majority of people in Iberia were Christians. Two hundred years later, the majority were Muslims.

The Muslims never ruled all of Iberia. Certain regions, particularly in the north, remained independent, or were only loosely allied with the emirate, and they repeatedly rebelled. Then there was the strife within the Muslim populace. Christians and Jews were not the only ones who received unequal treatment–any non-Arab did. That included the descendants of the North African Berbers whom the Arabs had added to their empire at the beginning of the eighth century and who came with them to Spain. The Iberian Berbers were Muslims, and the emirate’s best warriors. (Tariq ibn Zayid, who led the invasion of Iberia, was a Berber, and so was his cavalry.) They also outnumbered the Arabs in Spain. Therefore, they resented their second-class status. For much of the history of Al Andalus, the emirs had to deal with Berber revolts. Another reason the Iberian Arabs had to go back to war was that the conversions to Islam, in freeing people from the jizya, were depleting the treasury. The emirs had to find more infidels to tax. Finally, there was the command of jihad. The Arabs had never meant to stop at the Pyrenees, and, in 732, only twenty-one years after they entered Iberia, they scaled the great mountains and went down the other side.

The kingdom they were invading was Frankland–roughly, France, Belgium, and parts of western Germany–under the rule of Charles the Hammer, or, in French, Charles Martel. The Muslims lost some engagements and won others, but because of a Berber revolt at home they were soon forced to withdraw. In 778, the Franks–now under the leadership of Charles Martel’s grandson, Charles I, the Great, or Charlemagne–retaliated. Second to Rahman, Charlemagne is a hero in Lewis’s eyes: not just a military genius but a good man and a dashing fellow. Lewis tells us three times that the Frankish king stood six feet three inches tall. He pictures him, his blond hair flowing, his blue cape billowing behind him, astride a huge white stallion. If the Franks were primitive, Lewis says, the peoples whom Charlemagne had conquered–the Saxons, the Lombards, the Avars–were more so. Their new king tried to improve them. He imposed chastity on the priests, to their distress; he forbade incest, apparently a popular practice among the people. To elevate the culture of Frankland, he founded the Palace School, a combination think tank and college, and imported learned men to staff it, but his efforts were limited by the fact that he was constantly in the field. Charlemagne’s neighbors did not submit easily to his rule–especially since, unlike the Muslims, he required them to convert. So when he wasn’t conquering he was reconquering. That is what ended his Spanish campaign. After a few months, he received news that the Saxons were in revolt, and he had to go home.

Both Rahman and Charlemagne were primarily founders, men whose actions bore their finest fruit after their deaths–in Charlemagne’s case, long after his death. (Rahman died in 788; Charlemagne, in 814.) But their struggles are the central human drama of Lewis’s book, and once that is over he loses heart somewhat. In the case of Frankland, he could hardly do otherwise. Less than thirty years after Charlemagne’s death, the empire that he had worked so strenuously to unite was carved up into three parts, one for each of his grandsons. Meanwhile, the Vikings invaded, and the divided kingdom was powerless to stop them. By the end of the ninth century, Frankland was a ruin. “Walled settlements anchored timorous villagers and peasants driven from their land,” Lewis writes. “Blackened silhouettes of abbeys and monasteries outlined the horizon.” The Vikings did not care to have palace schools. “They are the filthiest race that God ever created,” a Muslim ambassador wrote. “They do not wipe themselves after going to stool, nor wash themselves . . . any more than if they were wild asses.”

Al Andalus died more slowly. The Vikings made no headway there; Muslim Spain was attacked, as usual, by its own–the Iberian Berbers, the Christian territories of the north–and by North African Berbers who came in as reinforcements and then seized power. These Africans brought with them a form of Islam far more strict and exclusionary than Iberia had known before. Between that and a cycle of rebellions and reprisals, convivencia came to be viewed as a form of laxity. In this late period, the armies were not headed by Arabs. Prosperity had softened the Arab elite. They liked the good life; they had little taste for war, where you couldn’t get a decent meal or a bath. (The Iberian Muslims felt strongly about personal hygiene. They had toothpaste and underarm deodorant.) So they stayed home, and sent Berbers, Africans, and slaves to fight their wars–less wisely, and more brutally, than they would have done. Here, Lewis sounds a tragic note: the more civilized a people, the more vulnerable.

Year by year, the good life vanished. Book burnings began, together with pogroms. Revolts and reprisals were conducted in an ecstasy of violence. When Cordoba, under the emir Muhammad II, was invaded by a rival claimant to the throne, the latter’s Berber army raped the women, sacked the city, and knocked down its splendid buildings, including Rahman’s palace. (They spared the Great Mosque.) Twenty years later, the Iberian caliphate was dissolved, and the peninsula was divided among taifas, or petty kings, who ruled with a new cruelty. At this point, the Reconquista–the recapturing of Spain by the Christians–began in earnest. Toledo fell to Alfonso VI of Leon and Castile, a Catholic king, in 1085. Four more centuries passed before the expulsion of the last emir from Granada, in 1492, but Lewis gets through them fast. He doesn’t want to talk about it.

Instead, he turns to Muslim Spain’s contributions to learning, which peaked as its political situation was declining. Architecture continued to flourish (the Alhambra, in Granada, was begun in the thirteenth century), as did music, poetry, science, and mathematics. It is thanks to Muslim Spain that we no longer have to cope with Roman numerals. Paper-making technology was imported from China. The central library of Cordoba housed four hundred thousand volumes. But Al Andalus’s most lasting cultural achievement was its translation and elaboration of ancient Greek texts. In the tenth century, the physician Hasdai ibn Shaprut supervised an Arabic translation of the Greek De Materia Medica, by Dioscorides, a surgeon to the Roman army in the first century. Retranslated into Latin, this treatise was a standard medical reference until the Enlightenment. In the twelfth century, Averroes (Ibn Rushd) wrote his commentaries on Aristotle, and Moses Maimonides (Musa ibn Mayum) produced his Aristotle-inflected “Guide to the Perplexed.” Both these Cordoban philosophers took on the task of reconciling reason with faith, of proving that there was a God. For the Christian world, that job would be done by the Scholastics, above all by St. Thomas Aquinas, whose writings were the basis of European philosophy from the thirteenth to the sixteenth century. But Aquinas relied heavily on Averroes’s reading of Aristotle. Insofar as Western culture grew out of Greek culture, and became “classical,” it did so because the scholars of Al Andalus transmitted Greek thought to western Europe.

By the twelfth century, though, such thought was dangerous in Spain. (Averroes’s books were burned; some were lost permanently.) It was more dangerous on the part of Jews, like Maimonides. He died in exile, bitterly reproaching his homeland for its abandonment of liberal ideas. (Here one thinks of the European Jews of the nineteen-thirties.) With the deaths of those two men, the lights go out in “God’s Crucible.”

In view of Lewis’s high opinion of learning in Al Andalus, it is amazing how little space he gives it. Averroes and Maimonides get seven pages between them, but, given their importance, that’s meagre. Lewis doesn’t care much about art, either. In his description of the fabled palace Zahra, built by Rahman III, in the tenth century, what he stresses is not so much its art as its political impact: its ability to awe visitors, humble them, impress them with the power of the caliphate. Social history, too, is largely absent from “God’s Crucible”–we get no sense of what it was like to be an Andalusian citizen, rich or poor–and there is almost nothing on the country’s religion, which is a strange omission in a book about a theocracy. Basically, “God’s Crucible” is about fighting and ruling. Lewis makes warfare exciting. (“The heavily armored cavalry . . . commenced the attack in a chorus of ‘Allahu akbar’ “–”God is great”–”tearing up the hill from the Roman road in a nimbus of nostril steam from their mounts behind volleys of arrows.”) He is also partial to succession struggles. We get to hear how Pippin II, Charles Martel’s father, roused himself from a coma long enough to issue a death warrant for some throne-grabbers and, that done, lapsed back into the coma and died. Lewis also gives us the excellent sobriquets of the rulers in his story, not just Charles the Hammer but Bertha of the Big Foot (Charlemagne’s mother) and al-Walid the Inadequate. Even when he doesn’t have a story, he tells one. Little is known about the monks who wrote what history we have of the Dark Ages from a European perspective. But Lewis imagines such a chronicler, at the abbey of St. Denis, outside Paris, on a cold night in the early eighth century: “Perhaps he sweetened a carafe of rough wine with honey or cinnamon while he shivered near the fire in a smoky room, his eyes straining in the penumbra as the stylus incised momentous events on the page.” It’s like a movie. Finally, Lewis has a wonderful command of narrative structure. Anyone writing the history of Muslim Spain must also, in some measure, give a history of the Roman Empire, the Byzantine Empire, the Frankish Empire, and indeed the Muslim Empire that ruled the East before and during the Arab rule of Iberia. Lewis does so very skillfully, moving these polities in and out as if he were operating a rotating stage set.

His lively prose sometimes tips over into vulgarity. When he quotes people, their words are “gasped” or “winced.” When there is a battle on the Rhone, the water flows crimson; when there is a battle on the Euphrates, it flows burgundy. Lewis likes extended metaphors, including the mixed variety. (“The French nation and the papacy, the future house of Europe’s post and lintel, were entities in utero as the Muslim dawn broke over the peninsula.”) And he has a weakness for jargon and cliche. Kings recruit “the best and brightest.” If they are doing well, they are “on a roll.” “On the minus side,” they may get locked in a “superpower death struggle,” and if they don’t use “scorched-earth tactics” they may go into “a downward spiral” and lose their “real estate.” There is something like this on every other page.

The goosing-up is often in service of showing that the Franks were less civilized than the Muslims–a point that Lewis cannot stop making. The Muslims built cities; the Franks lived in uncleared forests. The Muslim emirs had marble palaces; the early Frankish kings, wooden houses. The Muslims got around on their fabled stallions; Charlemagne’s ancestors were “trundled to their few ceremonial duties in ox-drawn carts.” The Muslims had silver coins, and traded in silks and spices. The Franks had a largely barter economy, “little better than the Late Neolithic.” Upper-class Muslims are shown attending salons, where they read poetry and discuss ideas, unlike Pippin the Short, Charlemagne’s father, who received ambassadors in a room filled with “bearskins, stacked weaponry, snoring dogs, cluttered bones, and upturned wine jugs.” Frankish knights spend only winter in their homes, “with howling wolves outside and indiscriminate copulation within.” Come spring, they discontinue copulation and begin slaughter, which occupies them for the rest of the year. The Muslims’ northern foes are “piranhas,” “veteran killers,” “unbathed, larcenous”–hairy, too. Their culture is “the Occidental void.” Often, Lewis compares their activities to twentieth-century atrocities: ethnic cleansing, the “final solution.”

Rightly, he does not make a fuss over practices–conquest, slavery, and the subjugation of women–that, however unjust to our eyes, were normal in the Dark Ages, but when he can give the Muslims an edge in these matters he does so. Unlike others, he says, they did not enslave their co-religionists, only infidels. (Why is that better?) As for restrictions on women–an inflamed topic in our time–he acknowledges that the Muslims’ were harsher than the Franks’, but he believes that Muhammad did not intend this severity, and that the Koran is kinder to women than either the Torah or St. Paul. When the Muslims crucify infidels, this is one of the “regrettable aspects of nation-building.” When the Muslim state falls, the jihad on which it was built is not in view–only the Christian jihad. The reason Lewis concludes his book in 1215 is that that was the year in which Pope Innocent III launched the Albigensian Crusade, an especially vicious example of the religious fanaticism that, in Lewis’s view, Europe developed in reaction to the Muslims, and inflicted on a bleeding world for many centuries thereafter.

If, as Edward Said wrote, the old history books were covertly ideological, the current ones tend to be overtly ideological, as each new generation of scholars rides in to rescue supposedly worthy peoples who were wronged by earlier scholarship and, in their time, by axe-wielding conquerors. But all these peoples, or all the ones in Lewis’s book, were conquerors. If the Christians took Spain from the Muslims, the Muslims had taken it from the Visigoths, who had appropriated it from the Romans, who had seized it from the Carthaginians, who had thrown out the Phoenicians. Lewis does not pretend that the Muslims were not conquerors; he simply justifies their conquest on the ground of their belief in convivencia, a pressing matter today. I can foresee a time when another matter important to us, the threat of ecological catastrophe, will prompt a historian to write a book in praise of the early Europeans whom Lewis finds so inferior to the Muslims. The Franks lived in uncleared forests, while the Muslims built fine cities, with palaces and aqueducts? All the better for the earth. The Franks were fond of incest? Endogamy keeps societies small, prevents the growth of rapacious nation-states. The same goes for the Franks’ largely barter economy. Trade such as the Muslims practiced–far-flung and transacted with money–leads to consolidation. That’s how we got global corporations.

Each new problem in our history engenders a revision of past history. Many of today’s historians acknowledge this, and argue that their books, if politicized, are simply more honest about that than the politicized books of the past. This pessimism about the possibility of finding a stable truth may be realistic, but it seems to sanction, even encourage, special pleading–of which “God’s Crucible,” for all its virtues, is an example.

Joan Acocella

I believe that what self-centered men have torn down, other-centered men can buildup.

–Martin Luther King, Jr.

While most discussions of Barack Obama’s historic rise to the US presidency have addressed the issues of race that percolated beneath the surface of an ostensibly post-racial campaign, (1) few interpretations of Obama’s transnational heritage and global appeal have been proffered. Significantly, critics who have looked into Obama’s global background and impact have placed this question in the context of his autobiographical writings. (2) His bestselling memoir Dreams from My Father: A Story of Race and Inheritance (1995)–which documents his childhood, youth, and family history, concluding with Obama’s first journey to Kenya in 1987–and his second book, The Audacity of Hope: Thoughts on Reclaiming the American Dream (2006) are routinely categorized as personal memoir and political manifesto, respectively. Yet, the global context and political subtext of both narratives set the two books apart from conventional types of ethnic and immigrant life writing. Specifically, Dreams from My Father and The Audacity of Hope focus less on the concept of exile and its attendant liberating quests than on a kind of identity that both overwrites and compounds the author’s transnational consciousness, which evolves, paradoxically, along a circular and homogenizing trajectory. Obama’s journeys originate in and ultimately fold back into his identity as an American with a remarkably stable sense of self, despite the global tensions threatening to destabilize it. My contention here is that Obama’s autobiographical narratives instantiate much more problematical genres, written as they were at times when the author was straddling various zones in his personal and political evolution, as well as giving voice to divergent strands of his heritage and to the communities he has come to inhabit or represent. (3) Obama’s writings stage less a dynamic transformation of the self than an interior sublimation, sparked not by the horizontal pull of remote regions leaving their imprint on Obama’s psychic makeup and cultural inheritance, but by the vertical pressures of a layered identity.

In contrast to the reassuring promises he voiced in Berlin in 2008 about how the cultural walls still hampering globalization “cannot stand” and need to be torn down (Obama, Inspire 113), Obama’s self-fashioning has so far resulted in a surprisingly immutable and profoundly territorial persona. What emerges from Obama’s autobiographical writings, I would argue, is a form of self-reliance in Emerson’s understanding of the term, as a fidelity to one’s innate sensibilities (one’s Reason), which limits the influence of the external world (perceived through one’s Understanding). This includes the ability “to believe your own thought, to believe that what is true for you in your private heart is true for all men” (259). In Obama’s case, self-reliance is manifested in a discourse of transnational empathy, which, however, remains perfectly consonant with the image of the United States as a redeemer nation, and more generally with the precepts of American exceptionalism. The ideology of American foreign policy has absorbed this idiom in a way that has become increasingly unpalatable since the role of the United States as “the indispensable nation”–in Madeleine Albright’s phrase–entered a waning phase. “When American power was ascendant,” Andrew Bacevich writes, “the United States could pretend to interpret history’s purpose or God’s will. Today, it can no longer afford to indulge in such conceits” (121). In his political rhetoric, however, Obama indulges in precisely such conceits, placing the United States at the heart of a heroic global narrative whose essential validity is never questioned. In a statement meant to burnish his foreign policy credentials at the outset of his presidential run, Obama proclaimed that “the mission of the United States is to provide global leadership grounded in the understanding that the world shares a common security and a common humanity” (“Renewing”). In its concern for the well-being of fellow nations rather than for the military pursuit of global evildoers, Obama’s tone differs from George W. Bush’s imperial and imperious style that produced so much international resentment. Yet the global position Obama prescribes to the US continues a tradition of American exceptionalism that exceeds the soft power of a “global broker,” a function quite different from that of a traditional superpower, but one that many political scholars and pundits hope the US will play (Zakaria 233).

This essay aims to show how Obama’s autobiographical writings blur the distinction between a transnational perspective of the United States seen as one global player among others and an exceptionalist view of America as the core from which a universally shared global humanity emanates. Obama’s personal narratives achieve this conflation by rejecting the paradigm of multiethnic life writing as the mapping of mutable, hybrid subjectivities in favor of an investment in the self as both local (American, black, bound to the circumstances of Obama’s Western privileged life) and avidly transnational. The identity factors provided by Obama’s race and ethnocultural heritage, Paul Street has polemically argued, “helped voters see [Obama] as ‘brand new,’ making it easier for him to advance some very traditional and conservative agendas and beliefs … under the guise of originality and progressivism” (xxvi). While one could certainly quibble with this counterintuitive diagnosis, my sense is that Obama’s autobiographical works reflect a very similar paradox. They restore a form of narrative self-reliance and coherent subjectivity against the backdrop of dispersed multicultural landscapes regarded empathetically, yet largely serving as mere stepping stones in the construction of a monolithic and quite intimidating self-image. To prove this point I will first explore how Obama’s life narratives problematize basic assumptions of contemporary theory regarding post-national auto/biography, especially in light of the correspondences between Obama’s narrative self and the political function of his writing. I will continue by establishing some features of Obama’s ethnic and transnational self-positioning in contradistinction to the autobiographical persona of James Baldwin (Obama’s forerunner in the global mapping of African American identity)–a comparison that has much to tell us about the ways in which life narrative can help constitute political agendas. Finally, this essay will define Obama’s self-reliance not in opposition to the transnational scope of his writings, but as a key to his vision of American exceptionalism in a newly globalized world.

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AUTOBIOGRAPHY AS POLITICAL STRATEGY

Michael M. J. Fischer has argued that ethnic autobiography is central to understanding contemporary society because it develops a pluralist, multifaceted concept of the self, which Fischer regards as a “crucible for a wider social ethos of pluralism” (196). In writing from a marginalized position, the ethnic autobiographer gauges the culture at large, a hypothesis that Fischer sets out to test by looking at “non-cognitive” mappings of consciousness in autobiographical narratives, outside of ideological discursive practices. Many examples of immigrant autobiography justify Fischer’s focus on textual forms that expose the uneasy reconciliation or occasional clash of the multiply situated self with the monolithic identity that cultural assimilation prescribes. Yet, increasingly, autobiographies by ethnic subjects assume multidimensional positions that are easily trumped by their firm roots in a predominant culture. What characterizes these narratives is a multiplicity of subject positions that nevertheless cohere into a single hyper-cognitive identity, which is simultaneously politicized. (4) For instance, the centrifugal forces that allow the autobiographical subject of Philippe E. Wamba’s Kinship: A Family’s Journey in Africa and America to move away from the center–the American elite culture into which he was born and educated–and toward the margins of his African background (Wamba was raised in Tanzania) are closely entwined with the centripetal forces that return him to the center, namely his activism and the upward mobility that his Harvard education and elite connections stimulate. Wamba could draw on the same valuable resources of support and goodwill as Obama–from the identical Harvard-Columbia environment that facilitated Obama’s academic and political career, to the endorsement of renowned scholar Henry Louis Gates, Jr. In fact, Wamba’s coming-of-age story reflects a growing interest in personal narratives of Pan-Africanism, and coincides with a larger transnational memoir boom that saw the publication of countless narratives by second-generation Americans exploring their roots or by activists seeking to retrace the global footprint of their identities. (5)

Obama’s work is both in line with this trend and divergent from it. While personal narratives (and literary theory) over the past few decades have addressed “issues concerning,” in Sidonie Smith’s words, “something that used to be called the self but is now called the subject”–”a fragile fiction without origin” (393)–Obama aligns himself with the notion of a stable, unified selfhood transcending individualized geographies, an assertive form of subjectivity that becomes embedded in and complicit with the hegemonic ideologies of American exceptionalism. Far from “decentering the very concept of nation” (Egan 36) in stressing his transnational heritage, Obama also avoids blatantly reinforcing the “individualized shell of Western selfhood” (Watson 213). Instead, he resorts to a canny and purposeful blending of the two: on the one hand, global egalitarianism; on the other, the defense of the US’s exceptional privileges. This new stance may partly be traced back to the inevitable impact of the culture wars on a politician’s strategies of self-representation, inviting him to forge a marketable sense of identity patched together from disparate elements that would ideally shore up various constituencies. (6) Indeed, Obama’s campaign advisor David Axelrod–a media strategist with “a special talent for tapping into the most compelling personal life stories of a candidate and composing a campaign script that enhances those qualities for public consumption” (Mendell 165)–can undoubtedly be credited with parts of Obama’s autobiographical message, which was presented to the public in the opening paragraph of almost every stump speech and in the biographical video broadcast at the Democratic National Convention in Denver. Axelrod also engineered the first-term senator’s trips to Africa not only as a way of allowing Obama to explore his family history and gain insight into the war-torn, AIDS-crippled continent, but also as a way to advance the rapidly growing legend around the young senator’s unique ancestry.

The challenge posed to the Democratic opposition by the spotlight on Obama’s transnational roots is evident in a memo written by Mark Penn, Senator Clinton’s chief strategist, in 2007: “All of these articles about his boyhood in Indonesia and his life in Hawaii are geared towards showing his background is diverse, multicultural, and putting that in a new light. Save it for 2050″ (Greene 165). Supporters, on the other hand, feared that Obama’s colorful background might obstruct the electorate’s trust in his fundamentally American values and temperament. Yet, as I aim to show, it is precisely this variegated personal history that has strengthened Obama’s American identity and reinvigorated debates about its exact composition. His “quintessentially American” self, Obama notes, “is all these different threads coming together to make a single quilt” (Brozyna)–an image of singularity that appears rather at odds with the diversity of its sources. Moreover, by admitting that his identity can be adapted from a national to a global context, Obama effectively abjures all sense of this identity’s uniqueness, proposing a universalist self as the inevitable result of a “home squared”–a phrase Obama uses in Dreams from My Father to refer to Obama Sr.’s native village in Alego, Kenya. This self is rooted yet double, multiplied less by the reproduction of a single location in other geographical zones than by a qualification of intensity. Transnational identity, then, is not a formula that extends the self over parallels and meridians, but is the result obtained by multiplying the self with itself, an extension in depth rather than space. Obama’s international and interior journeys–usually the two go hand in hand–are thus equally vital to understanding him as a migratory writer.

Dreams from My Father is, in this sense, both a memoir and an autobiography. (7) The book focuses on the narrator’s actions and on their consequences, as well as on the people he meets over the years, some of whom are more important or conspicuous than himself. One may be tempted to interpret this self-effacement through the lens of Paul John Eakin’s work on relational, dialogic selves, yet Obama’s own personality is rarely manifest enough to break through at all. The emphasis lies on the general scene of Obama’s upbringing and youth rather than on the author’s own sentiments and convictions. His opinions and feelings may fleetingly be observed, but they are never permitted to dominate the narrative. At the same time, the center of interest is the idea, if not the actual embodiment, of identity–the concept of someone like Obama, rather than the man himself, anticipating columnist Kathleen Parker’s quip after Obama’s Iowa triumph: “Americans are in thrall not with Obama but with the idea of Obama” (21). This focus on identity notwithstanding, the book never lapses into effusive navel-gazing precisely because it hardly ever lingers on Obama as the carrier of that identity. The community, the nation, and the world often relieve the narrator of the burden of his own self. It is, then, precisely in the imprecision of its transnational and global leanings that Dreams eludes the traditions of immigrant and African American life writing in which issues of identity politics, self-reflexivity, and self-representation are central and hotly debated.

Although he is keen to acknowledge the various aspects of the most intractable political issues, Obama leaves unexamined the problematical nature of autobiographical truth and the difficulty of ascertaining which facet of himself is rendered at any given moment. Allusions to these problems do not go beyond noting that he melded real people into composite fictional characters and inserted imprecise dialogue as a means of protecting the privacy of those involved. This creates the illusion that the author’s memory is virtually flawless, thus securing the inviolate preservation of the past ready for future inspection. Inevitably, however, as Eakin has observed, “the materials of the past are shaped by memory and imagination to serve the needs of present consciousness” (5).

To be sure, a politician cannot freely avow the presence of fiction in his autobiographical writings, as even minimal fabrication would be a potential threat to the success of a political memoir, antithetical as it is to the pursuit of truth that public office–at least theoretically–demands. Imagination, however, is a central feature of this truth, an ineluctable component of self-creation and self-reliance. In the words of Immanuel Wallerstein, who stresses the challenges to US power at the present historical moment, “we need to unify knowledge, imagination, and praxis…. The outcome is, I insist, intrinsically uncertain, and therefore precisely open to human intervention and creativity” (68). As an essential engine of political rhetoric, personal narrative seems justified in assuming a substantial amount of creativity and poetic license.

However, like other political memoirists, Obama has to negotiate a difficult balance between imaginative self-creation on the one hand and the constraints of verifiable fact on the other, fact that may come under scrutiny by an opponent’s research teams and get a full airing in the media if even slightly misleading, partial, or mendacious. (8) In this sense both Dreams and Audacity depart from the conventions of autobiography and memoir, and may be described instead as “projective” autobiography: a form of confessional discourse that sets the parameters of a practical goal (here, the campaign for the presidency) by establishing the core of a narrative self to be elaborated on in future incarnations. So even though it may seem that Dreams is a “remarkably candid memoir” that “is much rawer than the typical book from a politician,” tracking its protagonist’s movements “with more frankness than a political consultant would probably advise” (Mendell 17), the true function of the book can be intuited from the role it played in Obama’s campaigns: to preempt attacks by laying out the candidate’s past and revealing a degree of lucid self-knowledge rare on the political scene. In Obama’s case, this is a self also designed to surmount the crises of identity and vocation posed by his runs for public office.

In fact, a nearly four-hundred-page memoir written at the age of just thirty-three might create the appearance of self-indulgence, rather than self-doubt. There is indeed no dearth of evidence for Obama’s sense of confidence and self-worth, the “certain megalomania” (Audacity 125) that propelled him to the rank of senator. This feeling appears to have been inspired by, among other things, his mother’s “faith that rational, thoughtful people could shape their own destiny” (Dreams 50), and by his own conviction that by bringing elite knowledge to the underprivileged, “like Promethean fire” (276), he treads in his father’s footsteps, “acting out some grand design” (277). Obama’s resolve may have been further fuelled by the fear that he might be reliving the same “preordained script” that damned his father, that he might be a “captive to his tragedy” (227). Yet his autobiographical persona is often surprisingly self-effacing. In his early memoir, he frequently gives credit to others and downplays his own merit, a point taken up by analysts and biographers (Mendell 71). Significantly, the reverse trend can be observed in Audacity, with Obama taking credit for politically successful ideas that his advisors initially proposed–a gesture that may also reflect his adaptation to the mechanisms of political team-working and the construction of effective leadership (116).

Whether the author misremembered or simply retouched some of the details in his books, it is clear that most events of his past are mapped out in his mind with utmost precision. Obama decided very early on that a consistent monitorization of his daily activities, coupled with reflection on the paths pursued and the roads not taken, would help keep track of the self’s transformations, although it is impossible to conjecture whether anything more than adolescent self-consciousness might have motivated this rigorous self-surveillance. David Mendell provides valuable evidence on this count:

This meticulous self-observation probably helped young Obama find his way around the various communities he joined over the years (six by the time he entered Harvard, each with a different family and peer constellation), and this peripatetic lifestyle may have sparked his interest in the idea and workings of communities in general. Prior to his appointment as a community organizer for the Developing Communities Project on Chicago’s South Side, Obama considered his options in geographical terms: Hawai’i lay behind him “like a childhood dream,” Africa appeared too far removed to be claimed as a home, while his African American identity remained “unanchored to place”; in seeking a community, Obama longed for “a place I could put down stakes and test my commitments” (Dreams 115). It was precisely because of his rootless past that Obama revered the localism afforded him by community organizing, an activity that some have suspected him of using “simply to find grist for his version of the great American novel” (Mendell 64).

More likely, community organizing offered the young idealist eager to shape his own individual destiny a morally defensible means of achieving this goal indirectly. Helping people prosper by coordinating their collective struggles for racial equity and justice allowed Obama to create rather than possess self-reliance. As one of his former professors explains, Obama could organize other people’s thoughts without revealing any of his own concerns and conflicts (Kantor 2007). “Once I found an issue people cared about, I could take them into action,” Obama explains: “With enough actions, I could start to build power. Issues, actions, power, self-interest. I liked these concepts. They bespoke a certain hardheadedness, a worldly lack of sentiment; politics, not religion” (Dreams 155). What may seem egotistical or misguided when applied to oneself–the pursuit of self-serving power–acquires a virtuous halo in the context of community building and poorly remunerated public service. In his address to Knox College graduates in 2005, Obama even denounced the overemphasized importance of individualism and personal freedom in nurturing the American Dream as a practice of feathering one’s own nest. He went on to suggest that the Dream “has also depended on our sense of mutual regard for each other, the idea that everybody has a stake in the country, that we’re all in it together” (Dupuis and Boeckelman 104). Yet to some extent the purpose of Obama’s community involvement also rests in a “promise of redemption”: through organizing and shared sacrifice he aims to “earn” membership in a community that will thus eventually “admit the uniqueness” of his own life (Dreams 135). As a frustrated colleague once put it, Obama’s efforts are “all about himself,” but it is precisely his willingness to offer himself as temporary filling for the cavities of social injustice that constitutes Obama’s exceptionalist generosity. In an eloquently worded address, Caribbean-French writers Edouard Glissant and Patrick Chamoiseau commended Obama’s paradoxical mix of self-absorption and self-sacrifice as an instance of what Glissant previously called the “poetics of relation,” and an indication of the emergence of the US as a correlative nation–a “nation-relation” (Glissant and Chamoiseau 56).

Obama’s zealous response to the plight of the poor in fact almost gives the lie to the transnational ethos he seems to subscribe to, one that renders any strictly bounded sense of community or locality obsolete. Yet, both through his community organizing in Chicago and his frequent visits to Africa, Obama has shown his preference for those forms of solidarity that still rest on spatial contiguity and face-to-face contact. This can be read as confirming Appadurai and Breckenridge’s suggestion that the wake turbulence of transnational flows is marked by moments of disjuncture when “the politics of desire and imagination are always in contest with the politics of heritage and nostalgia” (iii). As a result of media dissemination and the circulation of political capital (Obama’s visit to Kenya in 2006 was widely reported by international media), even these situated communities emerge not as the isolated provinces that their social and economic marginalization might lead us to assume, but as “translocalities” connected by migratory routes (Appadurai, “Production” 204–225).

For Obama, Africa remains the least accessible of these translocalities, due to the disconnection caused by the death of his father (a Kenyan of the Luo tribe), and even prior to that, by his absence during most of Obama’s childhood, which, however, does not preclude his acting as a guide in his son’s quest for an essential American identity. The father/son binary that structures much of the transnational convergences in Obama’s life and writings also reveals the rupture between idealistic representations of migration (attached to Obama himself as a global figure) on the one hand, and the harsh reality of the transnational movements that caused the destitution and ultimately the premature death of Obama’s father on the other hand. It is Obama’s father, not Obama himself, who represents the most prevalent forms of migratory movements away from and back to Africa. Obama’s much more complex transnational leanings were certainly fanned by his background in Hawai’i as well–in its mix of Asian, Polynesian, and Western cultures. But these diverse allegiances resist classification into traditional categories of racial or national belonging. As Obama explains, with the same benevolent irony he employed on the campaign trail to mock the various ways his name had been mangled, depending on the ethnic extraction of whoever was trying to pronounce it:

As the child of a black man and a white woman, someone who was born in the racial melting pot of Hawaii, with a sister who’s half Indonesian but who’s usually mistaken for Mexican or Puerto Rican, and a brother-in-law and niece of Chinese descent, with some blood relatives who resemble Margaret Thatcher and others who could pass for Bernie Mac, so that family get-togethers over Christmas take on the appearance of a UN General Assembly meeting, I’ve never had the option of restricting my loyalties on the basis of race, or measuring my worth on the basis of tribe. (Audacity 274) (9)

Obama’s “loyalties” were also shaped to no small extent by his mother’s globe-trotting work as an anthropologist, and by her encouragement “to disdain the blend of ignorance and arrogance that too often characterized Americans abroad” (Dreams 47). Yet, it is indeed primarily in Kenya–a country that Obama never resided in for more than a few weeks–that he discovered his Americanness, simultaneously mapping both his Kenyan heritage and the traces left by his late father. Even before his first African sojourn, Obama’s idealization of his father facilitated his “selective embrace” of Africa as “an idea more than an actual place, a new promised land, full of ancient traditions and sweeping vistas, noble struggles and talking drums” (302), as a symbol of primordial human unity contained in the “stillness” and “crunching of bone” of genesis before distances set in and multiple languages dispelled the perfect harmony of the “common word” (356). Being in Kenya allows Obama to inhabit not only the country of his forefathers but also realms that may seem far removed, for this vast continent appears to distill the essence of all places, with its “trees that looked as if they might uproot themselves and simply walk away, were it not for the knowledge that on this earth one place is not so different from another–the knowledge that one moment carries within it all that’s gone on before” (437). For Obama, to be in Africa is to see past and present finally commingle, but also to live translocally, to inhabit one place and all places at the same time. Occasionally, this sophisticated response is expressed in an attitude that verges on tourism (Obama went on a safari to mark his first family visit), yet more often it evinces his serious efforts to understand the extent of his own commitment to Africa, a commitment reinforced by Obama’s own affiliation with Chicago’s Trinity United Church of Christ–a congregation that seeks to guide and educate African people in diaspora–as well as by his early interest in African returnees and African American migrants and exiles such as W. E. B. DuBois and James Baldwin.

STRANGERS IN THE VILLAGE: BARACK OBAMA AND JAMES BALDWIN

Unlike Baldwin in particular, Obama does not see in Africa a skewed mirror image of his African American experience, or a remedy for centuries of racial injustice. Africa is as much a myth to Obama as Obama is a mythical hero in the African imagination. Writing on Madonna’s second adoption of an African child, Chifundo Mercy James, documentary filmmaker Jacques Peretti marvels at the unchecked optimism of African people in poor rural markets, who believe “that Mercy could be like Barack Obama–she could leave a poor African state and end up president of the United States.” Of course, it was Obama’s father rather than the President himself who left Africa to join the ranks of the American elite, yet such distinctions do nothing to sway the myth that African communities have built around Obama, whom they at once admire from a distance and are eager to welcome back in their midst. So steep was Obama’s ascent to political power in the United States that Kenyans adopted him as one of their own living heroes, naming a beer and a rural school after him in the wake of the young senator’s 2004 convention speech, staging Dreams at the Kenyan National Theater in 2006 (Mendell 325), and occasionally expressing their view that this quasi-deity truly belonged in Kenya, not the United States, and would someday return (laden with riches). Indeed, “it is impossible to think of another American politician who has been involved in the life of another country as Obama has been with Kenya,” Colm Toibin wrote in late October 2008. Toibin suggests that Obama has a literary ancestor in James Baldwin, who lived much of his adult life and produced a considerable portion of his work in France and Turkey, occasionally returning to the United States to participate in the Civil Rights Movement. I want to suggest that the differences between Obama’s and Baldwin’s personal narratives provide a glimpse into the ideological capital and political functionality of Dreams from My Father and The Audacity of Hope.
 

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Not only did Baldwin divide his time among nations in which few African American writers had taken a consistent interest before, but he was also vocal about the invalidity of nations altogether, proclaiming in a 1970 interview: “I don’t believe in nations any more. Those passports, those borders are as outworn and useless as war” (Standley and Pratt 87). Obama was never an exile in Kenya or Indonesia to the same extent that Baldwin was an American expatriate in Paris, but if Edward Said is right, this fact should not diminish the value of Obama’s reflections on his predicament as a transnational writer and politician. “Even if one is not an actual immigrant or expatriate,” Said writes, “it is still possible to think as one, to imagine and investigate in spite of barriers, and always to move away from the centralizing authorities toward the margins, where you see things that are usually lost on minds that have never travelled beyond the conventional and comfortable” (380). Both Baldwin and Obama did not merely observe the “margins,” exploring and criticizing their social problems, but in the process they became more attuned to (and critical of) the “center.” In looking at France and Kenya respectively, they were ultimately observing themselves, comparing other peoples and nations to their own–and it is in this comparison that Baldwin’s and Obama’s approaches diverge. Baldwin sees an enormous gap not only between himself and French culture, but also between the freedom and sense of belonging that his American citizenship granted on the one hand, and the constraints on less privileged Africans on the other. This experience of gaps and disparities results in what Baldwin calls his alchemization into an American.

Obama is able to trace his ancestry back to African kings and tribesmen, while, as Baldwin notes, any African American descended from former slaves “wishing to go back so far will find his journey through time arrested by the signature on the bill of sale which served as the entrance paper for his ancestor” (125). Consequently, unlike Baldwin’s France, Kenya takes Obama back to his roots rather than away from them, which allows him to be less keen on stressing what sets him apart from the Kenyan people and their traditions. Baldwin sought a head-on confrontation with his own identity as a man and as a writer by taking up the position of a foreigner, thus inviting comparisons that would facilitate a more rapid maturation of his personality and craft. His decision to leave the US can be traced back to his need to gain some distance from the racial realities at home, which were threatening to impede his success and well-being, just as they had harmed many of his close friends. (10) By contrast, instead of actively seeking otherness, Obama feels called upon to accept it–in himself, his family, and peers. Yet even irrespective of the bloodlines that still connect him to foreign lands, Obama displays a clear preference for empathy, rather than contrast, in forging his personal identity as an American. In other words, while Baldwin’s writing permits divisive tones, Obama is constantly ready to include the opposite perspective as a result of his somewhat idealistic conviction that although conflicts cannot easily be resolved, it is our duty to question their premises and to discourage those who stoke them.

There are, however, notes of reconciliation in Baldwin’s writings, just as there are occasional belligerent tendencies in Obama’s, so it would be inaccurate to claim that their stances are polar opposites. In the concluding paragraph of his essay “A Question of Identity,” for instance, Baldwin observes that an American’s discovery of his own identity in Europe “is a discovery which not only brings to an end the alienation of the American from himself, but which also makes clear to him, for the first time, the extent of his involvement in the life of Europe” (100). In a 1972 interview he adds, somewhat reluctantly, that “you can’t be an expatriate anymore because America is all over the world. I’m still an American citizen. And what happens here affects people everywhere else and of course it affects me too, wherever I am” (Standley and Pratt 132). Such statements notwithstanding, Baldwin generally relies on a starkly polarized apparatus to distinguish himself from the Other he has sought out, in contrast to Obama, who opts for a more inclusive sense of self, rooted in the capaciousness and boundless empathy of American identity. While Baldwin’s peregrinations were prompted by and served to highlight racial injustice in the United States, Obama’s confirm that the US has begun to transcend traditional racial categories, not because racial minorities have fewer problems, but because global changes have forced them to review their position in a context that goes beyond US borders. Obama’s claim is thus not that racial issues are becoming less conspicuous in the United States, but that global trends are rapidly gaining visibility in ways that render theorizations of intra- rather than international ethnicity parochial and obsolete.

Colm Toibin sees in Obama’s conciliatory attitude less the genuine enthusiasm of a young idealist than the calculated foresight and ambition of an aspiring politician. This assessment appears more convincing if applied only to Obama’s second book, The Audacity of Hope, which formulates the author’s basic political platform. Dreams from My Father remains, above all, a testament to Obama’s conviction that the complex fate of being an American has come to engage the whole world in its rich diversity, as a heady mix of privilege, encroachment, and responsibility. In answer to his question why “black Americans were prone to disappointment when they visited Africa” (Dreams 433), Obama is told that African Americans often look for an authentic image of Africa and aspire to recover an “unblemished past” to make up for the cruelties they have suffered. By contrast, Obama weeps on the graves of his ancestors, acknowledging that the rift between present and past cannot be bridged by anything he is likely to find in his father’s homeland, but can only be navigated and overcome by his own willingness to accept that even in the US he has been an African all along, carrying beneath his skin the marker of his embedded (not double) identity:

When my tears were finally spent, I felt a calmness wash over me. I felt the circle finally close. I realized that who I was, what I cared about, was no longer just a matter of intellect or obligation, no longer a construct of words. I saw that my life in America … all of it was connected with this small plot of earth an ocean away, connected by more than the accident of a name or the colour of my skin. The pain I felt was my father’s pain. My questions were my brothers’ questions. Their struggle, my birthright. (Dreams 430)

This scene vaguely recalls the tears shed by some American expatriates in Paris as they fell down in the Jardin de Tuileries to weep by moonlight in an unabashed romanticization of Europe. (11) Like many of Obama’s speeches, the text is imbued with a touch of soulfulness that carries it toward an emotional crescendo summarizing Obama’s belief in the common bond of humanity and the beneficial ties of transnationalism. The affirmation inherent in the campaign motto “Yes, we can” is expressed here in an equally contained and circular manner: the self is propped up from both sides by unwavering hope and the possibility of action, comfortable in the knowledge that worries and responsibilities can be shouldered collectively. As the future presidential candidate would shout out to many a crowd on the campaign trail, they (his supporters), not he, are carrying forward the collective and somewhat diffusely orchestrated “Obama” project–the self all the more indelible through this temporary effacement.

Obama’s rewriting of American exceptionalism is also validated by the specific features of his writing. Instead of voicing strong opinions on cultural boundaries within or outside the United States, he attaches different perspectives to the protagonists of his story, allowing them to express their views with unrestrained conviction. His own contribution consists of self-proclaimed “rambling, hesitant, and overly verbose” musings (Audacity 144), which rather than cutting to the heart of the issues can be read as two-pronged masterpieces of equivocation. In The Audacity of Hope alone, Time magazine’s Joe Klein counted “no fewer than 50 instances of excruciatingly judicious on-the-one-hand-on-the-other-handedness” (46), a style that both betrays a lack of resolution and marks a clear improvement on the ideological inflexibility of the Bush era. “A good piece of legislation is like a good sentence,” Obama would tell New Yorker writer William Finnegan: both as a writer and as a legislator Obama seeks an optimal solution that would do justice to both content and rhetoric in a “more perfect” compromise, reduced, however, by virtue of its eclecticism to local rather than systemic solutions. One could argue, with Toibin, that this method betrays Obama’s intention to construct an innocent, impartial persona that did not lend itself to obvious criticism from his political opponents. Yet, beyond a measure of basic prudence, Obama’s ideological elusiveness embodies a feature of American exceptionalism best described by historian Richard Hofstadter: “It has been our fate as a nation,” he writes, “not to have ideologies but to be one” (43).

A FAMILY OF ONE: SELF-RELIANCE AS PANTHEISM

The “Obama” ideology of American exceptionalism as, oxymoronically speaking, global hegemonic empathy is unmistakably delineated in The Audacity of Hope. Obama’s personal, intellectual, and political autobiography was written with the aim of fleshing out the hope-and-dream message of a presidential candidate in the making. Obama explains his efforts to bring about social change as a reaction to “having lived abroad and having family in underdeveloped countries where the contrast between rich and poor is so sharp that it is hard to ignore justice” (Mendell 200). Obama explicitly attributes his appreciation of the American Bill of Rights to “having spent part of my childhood in Indonesia and from still having family in Kenya, countries where individual rights are almost entirely subject to the self-restraint of army generals or the whims of corrupt bureaucrats” (Audacity 65). Obama also strategically connects the Muslim elements of his upbringing to his position regarding the US war on terror and the poisoned history of its relations with Islamic nations. “Indonesia,” he writes, “serves as a useful metaphor for the world beyond our borders–a world in which globalization and sectarianism, poverty and plenty, modernity and antiquity constantly collide” (330). This is also a world in which the United States intervenes to assert its strategic interests–through quixotic, “morally rudderless” actions whose effects Obama emphatically bemoans (341)–maintaining rather than rectifying the imbalance between strong and weak nations, which Obama’s Indonesian stepfather Lolo memorably describes while teaching his son basic techniques of self-defense against school bullies (Dreams 41).

In Obama’s account of blissful years spent on the outskirts of Jakarta and later inside the city (between 1967 and 1971), trivial childhood memories acquire the status of magic symbols. The narrator’s attitude is symptomatic of Obama’s attempts to harness sentiment and transform a tale of innocence into one of political experience:

Obama evidently accepts the haptic and pantheistic qualities of such memories as valuable in their own right for the intensity of emotion they have generated in him (and may generate in others), but also as positive intimations of a transnational “structure of feeling.” Yet at the same time he never surrenders rational control of his emotions, admitting that his experience is based on a highly personal encounter (which “haunts” him), while offering to share its magic with his close family. Ultimately, despite the sensorial quality of his reminiscences, Obama’s narrative techniques reveal a high degree of critical and rational control, as they almost seem to borrow from the strategies of commercial advertising: my experience is unique, but you can partake in it; Indonesia is the epitome of Otherness, but this narrative is an attempt to grant you some access to its treasures; I, the author, am fully entitled and qualified to act as your trusty guide.

Childhood itself is a metaphor for a small, easily accessible world. As Richard Coe writes in his study of autobiographical narratives of childhood, “the child’s world is confined to a few streets or to a few fields; it is a path down to the beach along which every fence and every stile is known intimately by name, and the names remain as incantations” (127). It is a sheltered world that invites imagination to fill in its blanks, a world that may seem solipsistic in its reduction of the map of the world to the map of a local garden, yet also liberating in its unquestioning acceptance of the local as global. As Arjun Appadurai has argued, it is imagination (a concept of high density in Obama’s idiom) that allows subjects to negotiate between the communities in which they participate and “globally defined fields of possibility” (Modernity 31). Obama’s home and hearth in the world, it seems, is not a precise location–he would be hard-pressed to choose between Kenya, Indonesia, Hawai’i, Chicago, and Washington, D.C.–but childhood itself, as a positive mode of empathetic inquisitiveness into otherness, as well as symbol for a rooted cosmopolitanism driven by the power of imagination. Obama even refers to the contributions of various cultures to the formation of his personality in terms of childhood experience, which signifies a life stage where individuals are at their most impressionable: “I was raised as an Indonesian child and a Hawaiian child and as a black child and as a white child,” he notes, “and so what I benefited from is a multiplicity of cultures that all fed me” (Mendell 32). These symbolic connotations of childhood are confirmed by Sharon Stephens, who draws attention to

Obama conceives this community as capable of global empathy by virtue of its rootedness and innocence. “What strikes me most when I think about the story of my family,” he pointedly remarks, “is a running strain of innocence, an innocence that seems unimaginable, even by the measure of childhood” (Davis 28). Moreover, in establishing a path of embodied knowledge between the adult self and the childhood other, Obama can rediscover and reaffirm not only the consistency of the self over the various stages of its evolution over time, but also the connectedness that cuts across geographical boundaries between the communities that contributed to shaping that self. Put differently, Obama attempts to erase global borders by transgressing the limits of his present self, equating the capacious idealism and harmony of childhood with the opportunities that his global remapping of American life provide. This view of internationalism through the prism of childhood appears to demand, above all, the recognition and protection of a space for moral reflection outside the dictates of politics and commercial interests. Further, as a domain of play, the notion of childhood carries the possibility of moving beyond (national) structures of regimentation to welcome lifestyles from around the world. To look at a cultural environment through the eyes of a child is to view it as a living resource and inhabited space, rather than commodifying it or deploying it as a political instrument in the service of geopolitical and strategic interests.

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It appears that Obama’s firsthand experience of Third World countries, and implicitly, his post-national perspective on the United States, only enmeshes his identity more inextricably with that of the redeemer nation, probably because, as James Baldwin once remarked, “only someone who is outside of the States realizes that it’s impossible to get out” (Zaborowska 1). Obama’s acts of self-creation have, however, also shifted the focus away from the issue of national or post-national belonging toward an increased attention to the self and the mechanisms by which it attains its identity, which he understands as an inner enlargement of the self’s reservoirs over and above their exterior expansion. Obama’s avowed goal of “creating an America that is fairer, more compassionate and has greater understanding between its various peoples’ (Mendell 192) constructs the United States as a microcosm of the world–not a people but a set of peoples and plural communities. Yet the pattern of their coherence remains distinctly American, just as the blueprint for Obama’s own transnational profile can be found primarily in his sophisticated self-fashioning as someone who inhabits a family, a community, a nation, and a world, all interwoven in a stable food chain of subjectivities rather than an archipelago of identities:

I drew a series of circles around myself, with borders that shifted as time passed and faces changed but that nevertheless offered the illusion of control. An inner circle, where love was constant and claims unquestioned. Then a second circle, a realm of negotiated love, commitments freely chosen. And then a circle for colleagues, acquaintances; the cheerful gray-haired lady who rang up my groceries back in Chicago; until the circle finally widened to embrace a nation or a race, or a particular moral course, and the commitments were no longer tied to a face or a name but were actually commitments I’d made to myself. (Dreams 327-28)

The further away one strays from the self, the steeper the arc will bend back toward the axis, so the largest sphere of responsibilities–reaching beyond nations and races–ultimately weighs heaviest on oneself. The home of this American self is not “an outlier,” which is how Seymour Martin Lipset conceived American exceptionalism (26), but an abstract, “squared,” deeply ingrown subjectivity, just as the subject of Obama’s personal narratives is not a person but what a politician’s media strategists would call “the message”: an ingeniously crafted, self-referential persona, free of controversy and sharp edges of any kind. The boundary between this media-savvy political culture and the aesthetics of transnational life writing is a wall that Obama has already torn down.

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NOTES

(1.) See especially Michaels, as well as Frank and McPhail’s contrastive analysis of Obama’s address to the 2004 Democratic National Convention as a message carrying a rhetoric of consilience that threatens to obscure the racial realities of the United States.

(2.) I am referring here particularly to Toibin.

(3.) Dreams from My Father, for instance, was initially contracted as a meditation on race relations in the United States to be written by the first African American president of the Harvard Law Review. It became a memoir in the process, and was catapulted to the rank of national bestseller by Obama’s well-received keynote address at the Democratic National Convention in 2004. The history of the book’s reception is thus as variegated as the circumstances of its production. See also Mendell 15.

(4.) For a related argument stressing the investment of Third World autobiographies in such anti-postmodern terms as home, nation, and tradition, see Holden 93.

(5.) See also Khanga for another life narrative that offers insight into how African Americans struggle to negotiate their multiple heritage.

(6.) Obama’s opponent in the presidential race, Senator John McCain, was confronted with similar challenges by readers of his own autobiographical writings (especially Faith of My Fathers: A Family Memoir), which significantly–and ultimately to his detriment-grounded the author’s transnational background in his military experiences.

(7.) On the difference between the two genres, Lee Quinby notes: “Whereas autobiography promotes an ‘I’ that shares with confessional discourse an assumed interiority and an ethical mandate to examine that interiority, memoirs promote an ‘I’ that is explicitly constituted in the reports of the utterances and proceedings of others. The ‘I’ or subjectivity produced in memoirs is externalized and … dialogical” (299).

(8.) Obama’s account in Dreams of his life-altering discovery of an article on skin bleaching in the library of the US embassy in Jakarta indeed has not been verified, prompting political opponents to call into question the truthfulness of the whole memoir. See Davis 29.

(9.) During his campaign for the presidency, Obama sought to capitalize on the advantages afforded him by global identity politics, especially as it relates to foreign policy: “If we

can tell people, ‘We have a president in the White House who still has a grandmother living in a hut on the shores of Lake Victoria and has a sister who’s half-Indonesian, married to a Chinese-Canadian,’ then they’re going to think that he may have a better sense of what’s going on in our lives and in our country. And they’d be right” (Traub).

(10.) See Leeming 56, and Standley and Pratt 84.

(11.) See for instance Putnam 63.

Banita, Georgiana

After the fall of Baghdad, three years ago, the United States military began a secret investigation of the decision-making within Saddam Hussein’s dictatorship. The study, carried out by the U.S. Joint Forces Command, drew on captured documents and interviews with former Baath Party officials and Iraqi military officers, and when it was completed, last year, it was delivered to President Bush. The full work remains classified, but “Cobra II,” a recently published book about the early phases of the war, by the Times reporter Michael Gordon and Lieutenant General Bernard Trainor, has disclosed parts of the study, and the Pentagon has released declassified sections, which Foreign Affairs has posted on its Web site. Reading them, it is easy to imagine why the Administration might resist publication of the full study. The extracts describe how the Iraq invasion, more than any other war in American history, was a construct of delusion. Frustratingly, however, we now understand much more about the textures of fantasy in Saddam’s palaces in early 2003 than we do about the self-delusions then prevalent in the West Wing.

The study portrays the Iraqi President as a fading adversary who felt boxed in by sanctions and political pressure. Saddam’s former generals and civilian aides–such as his principal secretary, Lieutenant General Abed Hamid Mahmoud, and the former Iraqi foreign minister, Tariq Aziz–describe their old boss as a Lear-like figure, a confused despot in the enervating twilight of a ruthless career: unable to think straight, dependent upon his two lunatic and incompetent sons, and increasingly reliant on bluff and bluster to remain in power. Saddam lay awake at night worrying about knotty problems, and later issued memos based on the dreams he had when he drifted into sleep. As the invasion approached, he so feared a coup that he refused to allow his generals to prepare seriously for war. Instead, he endorsed a plan for the defense of Baghdad that essentially instructed his generals to talk with no one, think rousing thoughts, and await further orders. The generals knew that to question their leader or his sons was suicide, so they just saluted. “We’re doing great!” the Minister of Defense wrote to his field commanders on April 6th, as Baghdad fell.

Nor did this sham mask any plan to foil the invasion by launching a guerrilla war. There has long been speculation that the insurgency, which has so far taken more than twenty-three hundred American lives, might have been seeded in part by clandestine prewar cell formations or arms distributions. In fact, according to the study, there was no such preparation by Saddam or any of his generals, not even as the regime’s “world crumbled around it”; the insurgency was an unplanned, evolving response to the political failings and humiliations of the occupation.

As for weapons of mass destruction, there were none, but Saddam could not bring himself to admit it, because he feared a loss of prestige and, in particular, that Iran might take advantage of his weakness–a conclusion also sketched earlier by the C.I.A.-supervised Iraq Survey Group. He did not tell even his most senior generals that he had no W.M.D. until just before the invasion. They were appalled, and some thought he might be lying, because, they later told their interrogators, the American government insisted that Iraq did have such weapons. Saddam “found it impossible to abandon the illusion of having W.M.D.,” the study says. The Bush war cabinet, of course, clung to the same illusion, and a kind of mutually reinforcing trance took hold between the two leaderships as the invasion neared.

When the opposing armies finally crashed into each other in the desert, the professional officers fighting the war had in common a rich disdain for the self-styled strategists who had sent them into battle. Gordon and Trainor’s extensive interviews with the Army and Marine generals and colonels who commanded the invasion show that they had almost as little faith in Defense Secretary Donald Rumsfeld and his aides as their Iraqi counterparts had in Saddam and his sons. Indeed, the American officers featured in “Cobra II” are remarkably open about the war’s many errors of conception and execution. Of course, they do not seem to believe that any of the big mistakes were their fault–they blame the C.I.A. for repeatedly getting the battlefield intelligence wrong, and they blame Rumsfeld and his pliant subordinates for sending them to occupy Iraq with a force of inadequate size. The Army and the Marines have paid an extraordinarily high price for the war’s compounding blunders, and, presumably, the officers are speaking candidly now not just to settle scores but to avoid such bungling in the future.

As usual, this transparency and self-reflection does not extend to the White House. Bush and Cheney–even with their approval ratings at historic lows and with Iraq veering toward open civil war–and their staffs still apparently find it impossible to admit error. In the week marking the third anniversary of the invasion, the Bush Administration delivered a portfolio of speeches and op-ed essays that seem even more arid and isolated than usual. (The President kept repeating his claim that he had a “strategy for victory,” but he sounded as if he were reading texts from 2004 that his staff had forgotten to clear from his desk.) At the same time, the White House reissued a national-security strategy doctrine that blandly reaffirmed Bush’s intent to “act pre-emptively,” should he see the need, as if there were not a reason in the world to reconsider his assumptions.

The President and the members of his war cabinet now routinely wave at the horizon and speak about the long arc of history’s judgment–many years or decades must pass, they suggest, before the overthrow of Saddam and its impact on the Middle East can be properly evaluated. This is not only an evasion; it is bad historiography. Particularly in free societies, botched or unnecessary military invasions are almost always recognized as mistakes by the public and the professional military soon after they happen, and are rarely vindicated by time. This was true of the Boer War, Suez, and the Israeli invasion of Lebanon, and it will be true of Iraq. At best, when enough time has passed, and the human toll is not so palpable, we may come to think of the invasion, and its tragicomedy of missing weapons, as just another imperial folly, the way we now remember the Spanish-American War or the doomed British invasions of Afghanistan. But that will take a very long time, and it will never pass as vindication.

Steve Coll

FOR decades the Arab nations had been ruled by despotic leaders backed by Western imperial powers. These leaders behaved and conducted business in their countries much like the pharaohs ruled ancient Egypt. They stifled civil liberties, banned political groups and schemed to ensure that their children would remain in power after their death. Public anger had been simmering over the modern pharaohs’ heavy-handed policies for years and it finally reached its breaking point in January 2011. The oppressed people rebelled against the pharaohs, albeit without having a figurehead like Moses to guide them to liberation.

On January 14, 2011, a popular uprising broke out in Tunisia and felled the pro-US autocratic leader Zine al-Abidine Bin Ali. Mohammad Bouazizi, a 26-year-old street vendor set himself on fire after police seized the fruit and vegetables he was selling. His action triggered longstanding public anger over skyrocketing prices of consumer goods, massive unemployment and political repression by the regime. The regime’s violent suppression of protests generated increasingly violent further protest rallies and ultimately forced Bin Ali to flee the country and seek refuge in Saudi Arabia. After Bin Ali’s departure protest demonstrations continued as people demanded those associated with Bin Ali’s regime to step down from their positions in the government and on 27 February the prime minister finally resigned.

The Tunisian uprising sent tremors throughout the Arab world as the people decided to break the foundations of the repressive political system that had deprived them of their basic rights and subjected them to abject poverty. Large-scale protests against authoritarian regimes erupted in Yemen and Jordan and their nervous heads of state began backpedalling. The Yemeni leader Ali Abdullah Saleh called for the formation of a national unity government and said that he would not seek to extend his term when it expires in 2013. Saleh had seized leadership of North Yemen in 1978, and has ruled the Republic of Yemen since the north and south merged in 1990. He intended that his son, Brigadier General Ahmed Ali Abdullah Saleh who served as his close aide and advisor for years, should succeed him. Yemen is one of the poorest countries with a per capita income of about $1,100 a year. The US supported Saleh, provided him with military and financial aid which helped Saleh to consolidate his authority and remain a staunch US ally against al-Qaeda but also against liberal and democratic movements agitating for democracy in the Arabian Peninsula.

Inspired by the uprising in Tunisia, people in Jordan also vented their anger on the US-backed regime by organizing a large-scale protest demonstration in Amman, demanding fundamental change in the system of governance. Fearing for the safety of his dynasty. King Abdullah II dismissed Prime Minister Samir Rifai and appointed Marouf al-Bakhit, a former general and ambassador to Turkey and Israel to initiate political reform to meet some of the demands of the people. Opposition groups were not content with cosmetic reforms and replacement of government officials and continued their demand for more radical reforms that included lowering taxes, a new elections law based on proportional representation, reapportioning electoral districts and constitutional reforms to the effect that the prime minister be selected by the people not by the king. Similar mass uprising began in Algeria and Syria forcing the autocratic leaders to heed the demands of their subjects and take steps to reform the bureaucracy. People in Iran and Bahrain also staged protest rallies against oppressive rulers of their own demanding fundamental change in the system of governance. The bloodiest uprising of all took place in Libya against the dictator Col. Muammar el-Qaddafi who has single-handedly ruled the country since he seized power in 1969. However, the focus of this article will be the most important country in the region, Egypt.

Protest Rallies in Egypt

The uprising in Tunisia had inspired the downtrodden, dispossessed, and also the middle classes in Egypt to call for an end to years of authoritarian rule by the US-backed Egyptian leader Hosni Mubarak. With a youthful population at the front, anti-establishment rallies began on January 25 when thousands of social and political activists circulated a call on Facebook for a major rally against torture, poverty, corruption and unemployment. The call inspired thousands of people from all walks of life as they gathered in Tahrir Square (Liberation Square) in Cairo and marched toward the headquarters of the ruling National Democratic Party, Foreign Ministry and state-owned television station to protest against political torture, poverty and massive unemployment. When state security forces fired tear gas and used water cannons against peaceful people, protesters then demanded an end to three decades of authoritarian rule in Egypt shouting ‘Down with Mubarak’. People elsewhere in Egypt also organized protest rallies: in Mahalla al-Kobra, the hub of the Egyptian textile industry, police with riot gear fired tear gas at stone-hurling workers and in Suez, the burgeoning sweatshop of the Egyptian economy, confrontations between people and police led to the death of 11 people and injuries of over 100 people there. People took to the streets of Alexandria and the Nile Delta north of Cairo. Protest rallies continued in Cairo and the regime resorted to violence, firing rubber bullets and tear gas in an attempt to disperse the crowd. The government also took the extreme measure of shutting down channels of communication and internet services. The regime’s efforts failed to break the will of the people, who continued to chant anti-regime slogans calling for the pharaoh, Mubarak, to leave the country.

Factors Leading to the Public Uprisings

The massive protest rally in Tahrir Square was an expression of public disenchantment with an authoritarian political system that suppressed civil liberty, violated basic human rights and exploited citizenry that suffered abject poverty since Mubarak seized power in 1981. Capitalist-led development widened the gap between the rich and poor. Bureaucracy inhibited efficiency; corruption became the norm of running businesses and poverty spread throughout the country. The majority of Egyptians, particularly youths with advanced degrees from institutions of higher education, were frustrated by the lack of employment opportunities. They were forced to engage in menial jobs to eke out a living while a handful of privileged, associated with the corrupt ruling class, lived in luxury. In Cairo, home to eight million people, the majority of residents (almost five million people) lived in slums with no access to basic city services, clean drinking water and power.

Since Mubarak came to power he resorted to coercion and patronage to maintain the regime. Emergency laws were enacted that curtailed freedom of expression and movement. Mubarak’s manoeuvring to groom his son Gamal as the next pharaoh backfired because Gamal Mubarak was no Ramses. This factor on the one hand and political repression, growing unemployment and skyrocketing consumer prices caused opposition groups to challenge the status quo and in 2004 they formed an alliance for reform, Kifaya, meaning the movement for change. The Alliance included three major legal opposition parties–the Wafd Party, the National Progressive Unionist Party and the Arab Naserite Party. Its political platform attracted the support of the Islamic Labour Party and the Muslim Brotherhood. Although the Alliance did not affiliate with the Muslim Brotherhood, it had a number of people from the organization as its members. The opposition parties vehemently condemned Mubarak’s authoritarian style of leadership which was based on patronage and cronyism.

Mubarak had manoeuvred and won the October 2005 presidential election. However, during the parliamentary election in that year the Muslim Brotherhood captured 20 per cent of the seats. Its success in the parliamentary election sent shock waves through the regime. Fearing that the organization may gain credibility, the regime cracked down on the Muslim Brotherhood and other opponents. The constitution was hastily amended in order to prevent the Muslim Brotherhood from playing a role in national politics. Mubarak’s ruling National Democratic Party won a majority of seats during the parliamentary election held in November 2010, causing opposition groups to condemn the elections as fraudulent. Mubarak clamped down on opposition groups, journalists, social, political and human right activists and the Muslim Brotherhood, and claimed it was to maintain political stability. The regime’s brutal policy further emboldened and hardened the opposition’s resolve to fight for a democratic society.

Mubarak Manaoeuvres

As anti-regime protest rallies gained momentum the Egyptian dictator was forced to make some tactical concessions. On January 28, as in the past, he dismissed the cabinet, appointed his intelligence chief Omar Suleiman as vice president, the former commander of the air force Ahmed Shafiq as prime minister and removed the unpopular minister of the interior from his post. He defended violence against public rallies as a measure to protect public safety and maintain order. He declared that he would speed up efforts to tackle massive unemployment, improve the living conditions of the people and fight poverty and corruption. To stabilize the situation, on February l Mubarak made another statement saying that he would not seek reelection but would continue to rule the country until his tenure ended in September 2011. Such concessions did not please the people who were long accustomed to his deceptive policies. They were not moved by this overture and continued their protest rallies and demands that Mubarak step down immediately.

On February 2 a significant number of regime loyalists unleashed organized attacks on anti-Mubarak protesters. Riding camels and horses pro-Mubarak thugs carrying guns and knives confronted protestors, raining them with stones, bottles and Molotov cocktails. Opposition groups in Tahrir Square fought pro-Mubarak forces and expected the army stationed around the city to intervene and protect them as they naively believed that the army was on their side; however, the army did not intervene. During a confrontation close to the Egyptian Museum on the edge of Tahrir Square pro-Mubarak thugs blanketed the rooftops of adjacent buildings and threw rocks, bricks, and firebombs on opposition groups below. Pro-Mubarak policemen in plainclothes at the building’s entrance and among the crowd tried to prevent opposition groups from launching counterattacks. Confrontations between pro-Mubarak and opposition parties demanding change continued into the next day and pro-Mubarak forces attacked journalists, aid workers and human right activists while the regime condemned foreigners generally for instigating the turmoil. It was reported that the ensuing violence claimed the lives of many pro-democracy activists and injured thousands of others. As pressure mounted on the regime, Mubarak declared that if he left the country chaos would descend on Egypt and the Muslim Brotherhood would seize power. In stating so he intended to play the Muslim Brotherhood card in an attempt to win support in the international community.

The US Role in Egypt

The US regards Egypt as a crucial ally and often referred to it as a ‘populous democracy’ in the Arab world. The US strengthened ties with Egypt after Anwar al-Sadat seized power upon the death of Gamal Abdul Nasser in 1971. Egypt went to war with Israel in 1973, was defeated and lost the Sinai. Sadat and Israel’s Prime Minister Menachem Begin signed the US-sponsored Camp David Treaty on 17 September 1978, guaranteeing peace with Israel. In exchange for Egypt’s agreement on peace with Israel the US ensured that Sadat remained in power, providing Egypt with an enormous amount of military equipment and financial aid. The Camp David peace treaty ignored the rights of the Palestinian people as Israel continued its occupation of Palestinian and Arab lands. Sadat was assassinated by a member of the Muslim Brotherhood on 6 October 1981 and Hosni Mubarak, vice president since 1975, seized power. The US supported the new authoritarian ruler of Egypt and facilitated his collaboration with Israel in suppression of the Palestinians.

Egypt is one of the poorest nations in the Arab world and remains dependent on the US for economic, political and military support. The US provided $1.3 billion in military aid to Egypt annually; the bulk of US economic aid was appropriated by the military. Portions of this money had been used by the ruling class to buy loyalty and patronage in order to sustain the regime while a token amount was spent on social and economic projects. The US continued to regard Egypt as an indispensable ally in the region working to promote Western democracy and defend US strategic interests.

Although US leaders talked about promoting Western-style democracy in the Arab world, their intended target was anti-American dictators in the Arab world, such as Saddam of Iraq, Assad of Syria and Gaddafi of Libya while the US regarded pro-US authoritarian leaders of other Arab nations as its trusted allies. After the 11 September 2001 terrorist attacks the US intensified its cooperation with authoritarian leaders and provided them with military assistance and modern technology to contain anti-US sentiments in the Arab world. The US referred to opposition movements in the Arab world as movements that oppose Western-style democracy and freedom. The truth of the matter is that these forces are not opposed to democracy; they fight authoritarian regimes and leaders who oppose democracy and are allied with the US to facilitate suppression of anti-establishment movements. Mubarak was one such an Arab leader who supported the US policies in the Middle East and endorsed the US rendition programmes in Egypt. He staunchly defended US policies in the Arab world and for this reason the US continued to support him.

As the uprising continued throughout Egypt the Muslim Brotherhood and other banned political groups as well as the US appointed former head of the UN International Atomic Energy Agency, Mohamed El-Baradei, also joined the fray. The opposition parties demanded Mubarak’s departure from the country, dissolution of the sham parliament and agreed on the formation of a national unity government to lead the country. They declared their readiness for dialogue with the vice-president on the condition that Mubarak resigned from the leadership immediately. When the regime ignored their call and decided to suppress the opposition movement by cutting power lines to mobile phone servers and the internet, US-based Google provided a channel for the opposition to communicate with each other, coordinate their activities and maintain communication with the outside world.

As the situation remained tense in Egypt, President Barack Obama made a statement in which he sympathized with the people of Egypt and called upon the Egyptian government and the protesters to exercise restraint. Robert Gibbs, the White House spokesman reflected US views on the confrontation in Egypt stating that ‘If any of the violence is instigated by the government it should stop immediately’. When asked if the US viewed Mubarak as a dictator, Gibbs said that the 82-year-old Egyptian leader has a chance to demonstrate to the world ‘exactly who he is’ by initiating desperately needed change in Egypt. As opposition to Mubarak escalated the US insisted that Mubarak must make transition possible. The tacit US support for reform in Egypt was a clear sign that this particular puppet leader had lost his usefulness and ability to protect US strategic interests in the region. The US worked strategically to impose a solution to the political crisis to safeguard its vested interest by pressuring Mubarak to resign to ensure that the military would stand by vice-president Suleiman and the transitional government. America hopes that a fair presidential election can be held in September and that the influence of radical forces, especially the Muslim Brotherhood, can be contained.

Conclusion

Although the US regarded Mubarak as its ally, its policies in Egypt and elsewhere in the Arab world are determined primarily by its self-interest as Lord Palmerston once stated: ‘we have no eternal allies, and we have no perpetual enemies. Our interests are eternal and perpetual and these interests it is our duty to follow’. For America anyone who can effectively safeguard its interest is an ally. Mubarak did that for nearly thirty years, and post-Mubarak elites may do so, but the people of Egypt and other Arab countries despise US meddling in their internal affairs. US aid and money can buy the elite but they cannot buy the common people who fight for freedom and democracy. Although the Egyptians are ready to sacrifice their lives for change, fundamental change does not occur simply by ousting an authoritarian leader but by breaking the chains of imperialist capitalist domination of the country and laying the ground-work for the emancipation of the citizenry from all forms of oppression.

The situation in Egypt remains tenuous as the ruling class controlling the state loses their legitimacy and the opposition fighting the pharaoh lacks a figure like Moses, organization, and strategies to seize power. The alternative remains open to the army and a figure from among them may step in to seize command, making the obligatory: claim that the military will remain accountable to the people and initiate needed reform. Opposition groups lacking leadership and understanding of the situation will ultimately follow the lead by the army. The army does not represent the people; they represent the ruling elite who govern the country. In the Arab world the army has traditionally played a major role in the political process and this is likely to continue row and in the foreseeable future. When the uprising erupted senior Egyptian army officers were in the US for a conference and were rushed home to ensure that the army remained under state control.

As the public uprising continued the US established contacts with senior army officers and told them to refrain from firing on the crowds. This restraint was of strategic importance; if blood had been shed it would have tarnished the credibility and legitimacy of the army as in institution in the post-Mubarak period. The US has considerable leverage on the Egyptian army officers as virtually all senior officers lave been trained by the US and the army receives huge amounts of military aid from the US. As confrontations between pro-Mubarak and anti-Mubarak forces escalated to the point of destabilizing the country the US gave a green light to senior army officers to topple their boss who was no longer useful to its strategic interest. While the pharaoh resigned on February 11 and left Cairo, his spectre continues to haunt the democratic aspirations of the people. The ruling elite that exploited the people of Egypt under him remain in power with the army under their command. The military’s Supreme Council under Defence Minister Mohammad Husain Tantawi took charge of the country and suspended the constitution stating that an amended version will have to be ratified in a referendum prior to the September election. The military also dissolved parliament and declared that it would govern the country until elections were held. However, the military neither repealed the emergency laws nor freed political prisoners. In the meantime the military and the US try to identify individuals who could not only stabilize the country but also defend their interests and support them during the election in September.

The Egyptians, fed up with the authoritarian Mubarak regime and their miserable lives under it, were ready to sacrifice their lives to bring fundamental change to their country. Their sentiments are laudable but their efforts will ultimately fall short if they stop at anger and do not plot out their future after the uprising ends. Without a plan for continuity larger powers will step into the void and reset their political infrastructure. True change and democracy will only come when the repressive state apparatus is dismantled and replaced with a new state power and a new leader emerges: a leader like Moses with commitment to guide his flock to complete freedom.

Dr Hafizullah Emadi is a US-based scholar and consultant writing on institutional and political development in the Middle East and Central Asia.

Emadi, Hafizullah

There was plenty of illegality in the Enron debacle. Class-action lawyers are already ferreting out the company’s affirmative misrepresentations and nondisclosures of material facts (“big lies” to nonlawyers). All of these will be found to have violated the federal securities laws. Corporate executives who profited from private deals with Enron-affiliated partnerships without disclosure to the shareholders probably will be found to have violated the company’s own conflict-of-interest rules and breached their fiduciary obligations to shareholders. Arthur Andersen employees appear to have shredded documents related to the Enron audit, even though they knew the documents were relevant to pending or threatened civil and criminal investigations. It also appears that some executives engaged in classic insider trading by dumping their stock at a high price before the bad news about Enron’s real financial condition became public.

The illegality is important because of the scale of the wrongdoing and its calamitous consequences for stockholders, employees, and the securities markets. But this illegality is not novel or particularly interesting. What is interesting is that legal and regulatory restraints did not work to prevent or limit the wrongdoing or to expose it to public scrutiny early enough to reduce the damage.

These restraints did not work because much of what Enron and the people around it did was either completely or arguably legal, and the watchdogs involved with Enron–its accountants, lawyers, and independent directors–allowed the company to push itself to the very limits of legality. Enron thus presents a crisis not of illegality, but of legality.

There was nothing illegal, for example, about the high concentration of Enron stock in its employees’ 401(k) plans, which resulted in many lower-level employees’ retirement savings going down the chute with the company’s plummeting stock price. There was also nothing illegal about the company’s restriction on the employees’ ability to sell their Enron stock, even though senior managers were free to bail out. The use of off-balance sheet accounting to shift liabilities to affiliated “special-purpose entities,” allowing the company to hide debt and inflate earnings to maintain the stock price, has become an accepted although controversial practice. The aggressive accounting techniques used by Andersen were permissible under generally accepted accounting principles (GAAP). Andersen not only fully exploited the GAAP rules to hide debt, it took advantage of the latitude given accountants to determine when financial information is not “material” and therefore not necessary to disclose, and to rely on the “reasonableness” of the dubious assumptions made by Enron managers in formulating financial data. Also permissible was Andersen’s “mark-to-market” valuation technique, which allowed Enron to claim immediately projected earnings on energy transactions, even though any revenue from those highly speculative deals would be received only in the long term. Nor did the threat to an auditor’s independence created by doing lucrative consulting business with the company it audits create a legal impediment to Andersen’s dual auditing/consulting relationship with Enron.

The investment bankers to whom Enron confided information about their investment partnerships were not only permitted to withhold that information from their retail brokerage arms, and hence the investing public, but were required to do so because of the legally mandated “Chinese wall” between investment banking and brokerage functions in securities firms. Similarly, an argument can be made that Enron’s practice of sharing substantial information about its off-the-books investments with potential investment partners (mostly large institutions), but not with its own shareholders, did not violate the securities laws. There is even an argument that many of the stock sales by Enron executives were part of preplanned program trading under their stock compensation agreements, and hence not actionable under the antifraud provisions of the federal securities laws.

Most telling, there was nothing illegal about Enron’s uncanny ability to avoid regulatory scrutiny. Under both the Public Utilities Holding Company Act and the Investment Company Act, Enron managed to obtain, with public disclosure, exemptions from regulation by the Federal Energy Regulatory Commission, the Commodities Futures Trading Commission, and the Securities and Exchange Commission. The wisdom of those exemptive decisions is debatable, but they were lawful.

Significant revisions of the laws that have proven inadequate are likely. But the problem is greater than that of finding better laws. The real problem is the attitude toward legality that prevailed among Enron’s independent directors, accountants, and lawyers. They may have asked themselves whether what they and Enron were doing was “legal.” Very few, however, seem to have asked whether it was right. They were content to ask whether they could do it, not whether they should do it.

The response to this charge, particularly from the professionals, is predictable. They are likely to ask, “Who were we to judge? We are not moralists. We are simply providing a commodity: accounting and legal skills and knowledge. We were there to make judgments based solely on our professional expertise, not about right or wrong.” And we, the independent directors would argue, were simply depending on what the accountants and lawyers told us.

All this is sophistry. The supposed conflict between a person’s professional role and his or her responsibilities as a moral actor is an alibi, not a necessary reality. Accountants function as auditors on behalf of the public and must challenge the data and assumptions provided by management. This is particularly true when management’s positions are novel or aggressive. The role of the auditor is to evaluate, not facilitate. That role should be quasi-adversarial, not quasi-conspiratorial. Auditors’ professional obligations require a value judgment about the overall fairness of the picture presented by the financial statements they are charged with scrutinizing. By meeting this professional obligation, they would also have satisfied their moral obligation.

The lawyers’ situation is similar. Most of Enron’s in-house and outside counsel apparently signed off on numerous self-dealing transactions, staged perfunctory internal investigations, and facilitated a company policy of nondisclosure of highly significant information. Much of this arguably fell within the letter of legality, but apparently Enron’s lawyers never realized that it is sometimes necessary to say “no” to a client. Saying no is partially a matter of fiduciary duty to the client. But a lawyer must also say no to arguably legal actions that seem to the lawyer, as an independent moral actor, to be wrong, even if that means losing the client. So far as we know, only one or two Enron lawyers seem to have had the courage to challenge the insiders’ self-dealing. More courage by more lawyers could have made a difference.

The failure of Enron’s independent directors to monitor the out-of-control behavior of its managers is not likely to produce any legal liability, but it leaves them with a heavy burden of moral responsibility. They will cite in their defense the reassurances provided by expert accountants and lawyers, but their passivity breached not only their fiduciary obligation to shareholders, but their own personal obligation to stand back, look at the totality of circumstances, and ask whether what was going on was good for anyone other than a handful of managers who profited directly from their own manipulations.

Will something like Enron happen again? Every culture gets the scandal it deserves. Our culture breeds the attitudes and values (or nonvalues) displayed in Enron, and our supposed watchdogs are as much infected as anyone else. As long as professionals and directors inhabit only a legal, and not a moral universe, it is sure to happen again.

Mark A. Sargent is dean of Villanova University’s law school.

Sargent, Mark A.

BEFORE DECEMBER 11, 2008, few Americans had ever heard of Bernard L. Madoff. Yet after his arrest for running what authorities allege was the largest Ponzi scheme in history, Madoff not only achieved the sort of notoriety that is reserved for arch-criminals; he also became, in an instant, one of the most famous Jews in the world.

Madoff had been managing billions of dollars for investors who thought they were beating the market with the steady gains he reported. The profits were illusory. There was only a decades-long scam in which the “returns” of early clients were paid by the contributions of those who came later.

In the days following the revelation of the alleged $50 billion scare, the willingness of the press to refer to Madoff’s Jewishness set off alarms in a community uniquely sensitive about the way in which its members have historically been singled out for opprobrium. The theme of Jewish financial skullduggery is, after all, a familiar one in the canon of anti-Semitic invective. Madoff’s religion and his nefarious business practices were quickly intertwined by many hate-inspired Internet posters, which in turn aroused concerns at the Anti-Defamation League and the American Jewish Committee that the Madoff moment might mark the beginning of a new and uniquely dangerous wave of anti-Semitism.

But the specifically Jewish crisis that has been set off by the arrest and revelations has little to do with the rantings of anti-Semites on the Internet, who will always find something to which they can attach and insinuate their pre-existing perspective. After all, many of Madoff’s victims were not Gentiles entrapped by a wily Hebrew, but were themselves Jews.

Nor were these victims the only Jews harmed by Madoff. It soon became clear that he had caused vast sums from Jewish charities whose endowments had been invested, directly or indirectly, with Madoff’s firm to vanish. The numbers are unimaginably large. Yeshiva University, of which Madoff had served as a trustee, initially said its losses amounted to $110 million. Hadassah, the women’s Zionist organization, reported that $90 million was lost in the wreckage of Madoff’s collapse. The American Technion Society, which aids Israel’s Institute of Technology in Haifa, put its losses at $72 million. Amid a long list of other groups that have admitted to losing money were the American Jewish Congress, the Jewish Community Foundation of Los Angeles, the United Community Endowment Fund in Washington, D.C., the Elie Wiesel Foundation for Humanity, the Robert I. Lappin Foundation, and the Chais Family Foundation.

Commentary in the weeks after news of Madoff’s alleged crimes spread often centered on the way he had earned the trust and the loyalty of his dupes because of his status as a member of the tribe. Samuel G. Freedman, the New York Times veteran among whose books is the provocative Jew vs. Jew, wrote powerfully about the manner in which the power elite of Modern Orthodoxy had accepted Madoff as one of its own, even though Madoff was himself not Orthodox. According to Freedman, the connections in this insular world were intense:

The method by which Madoff ran his scam for nearly twenty years lends a certain force to this line of argument. For, unlike the legendary swindler Charles Ponzi, an Italian immigrant who gave his name to the phenomenon of the pyramid scheme, or the mysterious Augustus Melmotte, the con man who appears out of nowhere as the richest man in London and proceeds to fleece everyone in sight in Anthony Trollope’s astonishingly prescient 1875 novel, The Way We Live Now, Madoff was no outsider. Rather, he was a pillar of the worlds of New York finance and Jewish philanthropy, who like most successful Jews of his generation–he is seventy years old–rose from modest origins.

Born in Queens and educated at Hofstra University on Long Island, Madoff was only twenty-two when he formed a firm that specialized in trading stocks on the margins of the traditional market. Utilizing new technologies, he eventually grew his company into a billion-dollar business. He served for a time as chairman of the NASDAQ market and was a member of various prominent Wall Street committees.

Madoff’s firm recorded transactions. In 1989, he began a second business investing the money of others. He found his customers through informal networks of Jewish businessmen in New York, and in Jewish country clubs on Long Island and in Palm Beach (and a third in Minneapolis). His ability to operate comfortably in these social settings where his low-key approach worked best allowed him to build his reputation as a wizard with money. Madoff set himself up as the operator of an exclusive club to which only the lucky few were invited to profit from his genius. His money-management techniques, he claimed, resulted in a miraculous record of continuous profits even when the market was down. Banking on his status as an insider in the clubby atmosphere of such places, he expanded his clientele until it included not only rich men also but the charities they endowed and on whose boards they served.

There is nothing uniquely Jewish about the sort of scams that police refer to as “affinity frauds.” Such schemes have worked on a smaller scale among African-American, Hispanic, and white Baptist church groups. Criminals of all backgrounds and faiths have exploited co-religionists who trust one of their own, and have done so from time immemorial. Fewer probative questions are asked of people who prey on members of their own group, and when such questions are asked, the answers are often insufficient, as was the case whenever Madoff was asked about his methods.

No, what was unique about Madoff was the scale of his scheme, not the method of its execution. And that says more about the times in which we live than it speaks in any way to a flaw in the Jewish collective character–save, perhaps, for the flawed notion that Jews are somehow too smart to get bilked in so spectacular and embarrassing a fashion.

SOME OF the nonprofit organizations to which Madoff laid waste have since sought to minimize the impact of their losses by pointing out that much of their reported losses are, in fact, nothing more than fictitious profits that Madoff had claimed for them. Thus, Yeshiva University now claims that it has lost only $14.5 million. Similarly, Hadassah said that its vanished investment with Madoff was only $40 million, and the Technion Society informed its contributors that $29 million had melted into air.

The problem with downgrading the losses in this fashion is that it fails to take into account the potential honest earnings that were lost–the fact that had the money been invested with anyone else, it would probably have returned some significant degree of profit over the years that would not have vanished in an instant along with the principal.

It may be that, from the shell-shocked moment at the beginning of the Madoff scandal in which organizations overstated the pain caused them by his scheme, they have since consciously decided to play down the extent of the harm done. Perhaps it occurred to some of them that emphasizing their victimhood had the unfortunate side effect of making them look more foolish, and, perhaps, unworthy of being the recipients of further charity. No such effort to save face could help the smaller charities, such as the Wiesel, Lappin, and Chais foundations, which have been completely devastated and forced to shut down their operations. *

The future implications are not simply that many wealthy contributors in the Jewish community who have suffered serious losses will be unable to give generously to charitable causes in the future. There is, and will continue to be, a ripple effect from the Madoff scandal. Many of the groups that have been seriously hurt or no longer exist were themselves the source of funds for a variety of Jewish and non-Jewish activities. Charities that had no money of their own invested with Madoff were financially dependent on those that had. Scores of nonprofit groups designed to benefit Jews in the United States, Israel, and the former Soviet Union will now suffer profound budget cuts or worse.

Others, like the Gift of Life Bone Marrow Foundation, received a large proportion of their donations from Madoff’s own family foundation. With that source of support effectively ended, Gift of Life will not be able to expand its registry of bone-marrow donors in the coming year. Coming on the heels of a major downturn in the economy that had already had a profound effect on the volume of charitable donations in 2008, the Madoff fiasco is, as Abraham Foxman of the Anti-Defamation League put it in an interview with the Jewish Week, “the Titanic on top of a tsunami.”

THERE IS one particular aspect of the crisis, however, that has been little discussed, in part because it might seem to blame the victim. In the past two decades, there have been remarkable changes in the manner and practice of charitable giving in the United States–changes that unwittingly exposed the world of Jewish philanthropy to the possibility of an extinction event like the Madoff fraud.

The growth of personal foundations and niche charities has multiplied the number of potential outlets for Jewish giving. As local Jewish federations and other umbrella philanthropies have learned to their sorrow, donors have become less likely to hand over their money to a central authority and let that central authority spend as it likes. This is an understandable impulse; why shouldn’t people willing to give over a substantial part of their personal fortunes to charity have the final word over the disposition of their funds?

It turns out that there might have been good reason. The self-checking redundancies that are often found within large organizations tend not to exist at smaller family or personal foundations, where there is less infrastructure and fewer procedures to govern giving and investment decisions.

In addition, the willingness of all philanthropies to, as the Wall Street Journal put it, “move away from the practice of distributing all the money they raised each year to beneficiaries and begin to invest a portion of it,” had made them more vulnerable not only to the vagaries of the stock market but also to fraud. A case in point is that of one of the most prominent of Madoff’s contacts, Jacob Ezra Merkin, a leading Wall Street figure with great influence in the Modern Orthodox community.

Merkin’s own investment firm, Ascot Partners, channeled $1.8 billion to Madoff. Merkin also gave Madoff access to the board of Yeshiva University as well as to contacts at the UJA-Federation of New York and the Fifth Avenue Synagogue, of which Merkin served as president. It is worth noting that while some large groups proved not to be immune to the sort of apparent conflict of interest that led Merkin to divert some of Yeshiva University’s funds to Madoff through his own investment firm, the New York UJA-Federation investment committee that Merkin chaired was sufficiently scrupulous to prevent a similar diversion of its moneys.

MADOFF’S INFAMY will cause much breast-beating on the part of institutions that should have known better than to trust him. But even those groups that escaped him will now be forced to create mechanisms for greater accountability for their endowments and stricter policies of governance simply because there is less money to go around these days.

Gary Tobin of the San Francisco-based Institute for Jewish and Community Research estimates the annual amount of Jewish philanthropic giving in this country to be $5 billion. Jewish portfolios have taken the same hits as everyone else’s, and so it is fair to presume that figure will be in substantial decline over the next year or two.

Despite that, the impetus to give generously on the part of those who care about Jewish life or charitable giving in general will not disappear. The obligation to give tzedakah–the word derives from the Hebrew root for “justice”–for Jews who are influenced by their religious tradition has not been annulled by Madoff or the panic on Wall Street. If anything, the crisis set off by these events has increased the pressure on Jewish givers who are weathering the storm to give even more generously to cover the shortfalls from the combined effects of Madoff and the recession.

Perhaps this will set off a war of scarcity between Jewish groups fighting over the money of those who are still giving, but the initial indications are that cooperation may prevail over chaos. Representatives of thirty-five of the largest Jewish foundations in the country met in New York on

December 23, 2008, to coordinate their responses to the crisis and agreed to offer millions of dollars in loans to not-for-profits victimized by Madoff a heartening display of a community banding together in a time of crisis.

But the real problem facing specifically Jewish charitable organizations is not a scarcity of dollars to be spread among rival Jewish causes, but rather competition from secular groups that have also been injured by the economic crisis. An assimilated Jewish donor who feels the charitable impulse but has fewer dollars to contribute might feel a greater sense of affinity and cause with an environmentalist group or an arts organization, and focus his reduced power on them instead. Just as the openness of American society has made it less likely for Jews to marry other Jews, so, too, it is less likely that Jews will give primarily to Jewish causes.

THE LONG-TERM threat for Jewish philanthropy, then, isn’t Bernard Madoff but rather the overall threat facing the larger Jewish community in the United States–what came to be known, nearly two decades ago, as the “continuity crisis.” When the 1990 National Jewish Population Study reported alarming rates of intermarriage, numbers that offered the terrifying prospect of the eventual withering away of the Jewish population in the United States, a debate began in the organized Jewish world about how to address the approaching demographic disaster.

Should Jewish organizations attempt greater outreach to increasingly secular members of the community, even or especially to those who have intermarried, to help maintain bonds of kinship and prevent their becoming just another ingredient in the multi-ethnic American soup? Or should efforts focus on reinforcing the core Jewish population, to give it succor and strength, and to keep its people and children within the fold?

Those who argue that the Jewish future can only be secured by ensuring the continued existence and flourishing of practicing, believing, involved Jews –Jews who will take it as a mission and a duty to sustain the community over the generations–have promoted greater support for Jewish education through day schools, Jewish camping, and fostering a connection to Israel through the invaluable Taglit-Birthright trips to Israel for every young American Jew who applies. Most Jewish federations and the philanthropic world in general pay lip service to these matters, but in practice have failed to make them the priority.

The results of the past two decades suggest that the outreach model is a failure; individual Jewish federations and most communal organizations have seen declines in fundraising, and what data there are indicate that these efforts have done little to renew the commitment of Jews on the margins to the community or its future. Indeed, one of the reasons that generous Jews have been so determined to bypass the larger Jewish communal organizations may well be that those organizations have been so ineffectual in addressing the concerns of committed members of the community who have wanted to use their wealth to ensure a specifically Jewish future in the United States and in Israel. The consensus-driven culture of Jewish philanthropy has, predictably, failed to make a decisive choice with respect to the future of American Jewry.

The combined crises of 2008–the financial collapse and the Madoff scandal–will certainly exacerbate this dilemma and perhaps even sharpen the debate over the allocation of dollars. But the devastating losses created by Madoff pale when set beside the more pressing concern of demographic decline and the possibility that the decline in the number of people who are interested in Jewish causes will only accelerate over time unless something is done to arrest it.

The inability of the apparatus of Jewish philanthropy to find the will to focus its existing resources on the threat posed by rising levels of assimilation dwarfs the worries generated by financial scandals, even those as serious as that of Madoff.

THE PAIN caused by Bernard Madoff will be lasting and felt by a great many people. There can be little doubt that the method by which he used his Jewish identity to worm his way into the confidence of many Jewish investors and charities will be among the most memorable aspects of his villainy. But those concerned about the future of American Jewry have far more pressing worries than the money Madoff stole and lost or the ammunition he might have given to anti-Semites. The real question is whether, at a time when resources are growing relatively scarce, the American Jewish community will finally take the full measure of the threat to its long-term survival and husband its straitened resources to address that threat openly, honestly, and effectively.

* The same is true of two non-sectarian organizations–the Picower Foundation, which alone reportedly lost $958 million, and the JEHT Foundation.

This month, JONATHAN S. TOBIN joins COMMENTARY as its executive editor. This is his first article for the magazine.

Tobin, Jonathan S.

Most people by now may recall a moment of clarity, an inkling of doom. Maybe it helped a guy make money, or at least lose less. Maybe it came too late or went unheeded, so that now it nettles. The majority didn’t expect it to be so bad, and wouldn’t have been able to profit from or guard against it anyway. The sad fact is that betting against the global financial system requires more than pluck; you need to be a participant. Most of the mechanisms in place for the implementation of pessimism are known only to members of the guild.

I met a Wall Street cynic who had grumbled for years about the overextended consumer, the negative savings rate, and a profligate government that some day would be unable to make good on its promises. He foresaw a grisly end to the credit boom, if not a collapse in the markets for stocks, real estate, art, mediocrity, and foolishness, and yet, like most people, he lacked the conviction and, perhaps, the macroeconomic purview to translate his misgivings into financial gain. He got short too soon and lost heart. Meanwhile, life and the general mood conspired to compound his long position. He bought a house and went to work for a hedge fund–the latecomer playing catch-up, eager for a piece. The markets turned, and the hedge fund went under. One day in March, as the Dow fell to its lowest level in a dozen years, he e-mailed me an investment letter, in which a hedge-fund manager surveyed the world’s insolvent banks and unstable sovereigns and anticipated a possible collapse of the global financial and monetary systems–the end of fiat currencies and the beginning of Lord knows what. It concluded that the world needed a “do-over.” “Can I have a do-over, please?” the cynic wrote. As a broker said to me, “If it’s the end of the world, you only get to bet on it once.”

For many, the awakening came while they were driving through some over-built exurb in Florida or California, or watching a commercial for a subprime lender (“Mortgage consultants are standing by!”), or studying a graph depicting the ratio of total debt to the gross domestic product. In the early days, intimations of economic imbalance could come to you in a fancy restaurant, or a Home Depot, or an A.T.M. vestibule: a two-hundred-dollar dinner, a traffic jam in bathroom fixtures, fees on top of fees on top of fees. A pulse of common sense suggests, This can’t last.

Some will tell a maid tale, the latter-day equivalent of the stock tip from the shoeshine boy (which, according to lore, persuaded Bernard Baruch and Joseph Kennedy to pull out of the market before the 1929 crash). A private-equity executive I talked to said that he sensed the jig was up when his cleaning woman–”from Nicaragua or El Salvador or wherever the fuck she’s from”–took out a subprime loan to buy a house in Virginia. She drove down with her husband every weekend from New York, six hours each way, to fix it up for resale. They cleared sixty-five thousand dollars on the deal, in a matter of months. To many, this would have been proof that America is a land of opportunity, but to him it signalled a fatal imbalance between obligation and means.

One evening, I visited a big-wheel hedge-fund manager in his corner office overlooking Central Park. His epiphany came in the spring of 2007, at a Goldman Sachs hedge-fund conference at the Museum of Modern Art. There were eighty or so people there, almost all of them men, and he calculated that their average income in 2006 had been more than a hundred million dollars. Here were eighty guys who all happened to live in the same part of the world and ply the same trade, and who could not possibly be as smart as their rapid accumulation of dynastic wealth had led them to believe. It was the first time in a long while that he had questioned his own intelligence, or whether there was a limit to what it was worth. He didn’t doubt that he was talented, even exceptional–if you harnessed the self-regard in that room, you could light up Los Angeles–but he perceived, in a way that he hadn’t before, the inequity of it all, and how corrosive and unsustainable it had become. Too much money, too few hands. Still, he failed to convert this intimation into discipline or conviction; being a billionaire is distracting. He and his partners continued to gorge on highly leveraged assets.

The sky was full of signs. The final one, the big wheel felt, was the opening ceremony at the summer Olympics in Beijing: an estimated three hundred million dollars spent in a single night on a propaganda extravaganza. Many people saw it the way the Chinese wanted them to, as an assertion of capability and might, but to him it was a heedless farewell binge–the great eruption that marked the end of a prodigal age. A month later, Lehman Brothers collapsed, and his business, his net worth, and his reputation were teetering. He was grateful not to be facing ruin. “It’s more traumatic to go from thirty million dollars to a million than it is to go from $1.5 billion to a hundred and fifty million,” he told me. “There’s a level over which it’s all just philanthropy.” This is what passes for perspective, in those high corner offices.

Some who foresaw the implosion underestimated its power and duration. A young Bostonian named Jeff Lick runs a hedge fund he called Galt Investments, for John Galt, the hero of Ayn Rand’s “Atlas Shrugged.” (He named his son Roark.) Lick was having an excellent 2008–he’d bet correctly on the collapse of the financials–but in October he closed out his short positions, expanded his long ones, and got trapped. The fund lost nearly half its value. (It has since recovered somewhat.) He wrote to his investors:

Most of you are rightfully asking yourselves right now, “Given Galt’s numbers through September and what was and had been transpiring all year, why didn’t you just go to cash and take it easy the rest of the year? . . . Further, you are probably thinking, “I am less concerned about what specifically happened in October than I am about the poor business judgment you have shown in general.” To these charges I plead guilty by reason of youth, inexperience, greed, hubris and temporary insanity. There are simply no good answers to the questions posed above.

No good answers: it depends on one’s definition of “good.” However dramatic and abrupt the events of September were, when Lehman failed and the government rescued Fannie Mae, Freddie Mac, and A.I.G., the meltdown was not so sudden. The pace of upheaval slows and accelerates, although the underlying conditions–crushing debt up and down the food chain and all around the world–remain relatively constant. The difficulties manifest themselves, one after the other, as their effects ripple through the system. In September, very few people, around here at least, were aware that more than half of the mortgages in Poland were denominated in Swiss francs, not zlotys, and that, if the zloty collapsed, Poland’s homeowners and their lenders would be devastated. Yet the precarious arrangement was there all along, for anyone who looked. The dance of revelation and recognition is not well synchronized.

This thing we’re in doesn’t yet have a name. It is variously called, in placeholder shorthand, the global financial meltdown, the financial crisis, the credit crisis, the recession, the great recession, the disaster, the panic, or the bust. It long ago metastasized beyond the subprime mess, which was merely a catalyst–the first whiff, the last straw. A text-friendly acronym, ITE, for “in this economy,” has started to get around, in sales pitches and head-count meetings, but it doesn’t do the work.

This thing is enormous and all-pervading, evolving and ongoing, history-altering yet in many respects banal. It is a persistent state, like the weather, or a chronic illness. In some circles–financial professionals in Manhattan, regulators in Washington, central bankers in Europe, or the owners of cash-strapped businesses, to say nothing of the millions of people who have been laid off or whose houses have been foreclosed on–this thing is, in its various incarnations, pretty much the only subject of conversation. The loss of a job, a home, a college fund, or one’s dignity is both a symptom of the collective disaster and a contributor to its deepening. People assess their own exposure first and then, gradually, the implications for their friends, their town, the social fabric, and, in the darker hours, the fate of the American experiment.

In a way, the financial crisis is like a plague or a war, except that the pestilence and carnage are metaphorical. Some have compared it to Hurricane Katrina, but Katrina occurred suddenly, and then all was aftermath. In this case, it’s as though the levees failed anew every day. We stay on the porch, carrying on with our card game, in water up to our necks. War (putting aside the question of whether it’s the inevitable result of all this) fails as an analogue, too: there is an enemy to shoot at, and the destruction is so gruesome that it is hard to mistake wartime for normalcy. An economic meltdown can camouflage itself in the commonplace. It is more like radiation. It’s everywhere, but you can’t see or smell it. And then a neighbor loses her job or her hair.

We are a visual species. In an economic crisis, in the early stages, at least (and we are likely still in the early stages, in spite of all the recent happy talk), the visible effects are subtle, if they are present at all. Maybe there are empty seats at the game. It is a mathematical predicament, an abstraction that expresses itself in dreary reports that don’t affect you, until they do. Deferred dreams aren’t news. Even the worst consequences–homelessness, hunger, untreated illness, everything short of civil unrest or outright revolution–aren’t spectacles. The history-making developments–the collapses of great or at least large institutions, the government’s deployments of sums beyond imagining, the exchange of gigantic liabilities for even more gigantic ones in the future, the effects these things have on geopolitics–are difficult to picture. People grasp at anecdotal observation: store closures, idle spouses, a rash of attacks by a mugger (a mugger!) with a pipe. The immigrants are going home.

Pictures from the thirties of breadlines or dairy farmers pouring out milk mean something to us now because we have a name for the Great Depression, and a discrete sense of the whole. This doesn’t look like anything yet. The cities aren’t crumbling; the Plains aren’t turning to dust; your four grandparents are not sharing a bed, like Charlie Bucket’s. Business-section editors settle for pictures of brokers on the floor of the New York Stock Exchange, choosing subjects whose facial expressions best capture whatever mood it is that the commentators have decided to blame or credit for that day’s market fluctuations. Never mind that the guys on the floor don’t always make money when the market goes up, or lose it when it goes down, or that they are the vestigial human practitioners on an otherwise mostly electronic exchange that represents but a sliver of the capital markets. You may as well have a photograph of a man fixing a flat tire or a child with a skinned knee.

A piece of corporate jargon sprouted up recently: “optics,” as a synonym for “appearances”–something that looks good or bad, in a public-relations sense. When a broken-down bailout recipient like Citigroup tries to pay its top executives gigantic bonuses or to acquire a new private jet, it has failed to consider the optics. Jets and junkets can be visualized, as can bonuses, if only as pallets of cash in a Swiss bank vault, and so they make better targets for popular resentment and politicians’ umbrage than some more arcane allotment mechanisms, like special-purpose vehicles and side pockets. (Of course, spending fifty million dollars in taxpayer money on a new jet looks bad because it is bad.) The news that A.I.G., the most egregious bailout pit of them all, was giving out a hundred and sixty-five million dollars in bonuses and “retention payments” stirred civilian outrage and drew a rebuke from the President. Heinous optics. But the sums were tiny in comparison with those likely to be deployed for the purchases, by private investors and the government, of toxic assets on the ailing banks’ books. These are assets that the banks have been unable or unwilling to unload on the market. In other words, for the plan to work, the government must allow itself to be gulled. But the arrangement doesn’t look like anything yet. It has no optics.

Similarly, we are fixated on Bernie Madoff, the money manager who admitted to running a multibillion-dollar Ponzi scheme, because, in part, he is larceny incarnate. He embodies many of the meltdown’s traits–the illusion of expertise, the belief in getting something for nothing, the mirage and subsequent evaporation of wealth. But Madoff is in some ways a distraction, cover for the quiet crooks. It’s telling, the way that people take his thin-lipped grin for an unrepentant smirk, instead of, say, a nervous tic. It’s his face–and his Upper East Side penthouse–that people have come to resent, rather than the culture of easy money and magical thinking that allowed him to thrive.

By now, most of the systemic flaws have been identified, explained, and lamented, if not yet collated or changed. In congressional testimony, the disgraced C.E.O.s of failed institutions–Richard Fuld, of Lehman Brothers; Martin Sullivan, of A.I.G.–talked about a “financial tsunami” that caught them unaware, as though they had not figured in the plate tectonics. Their obliviousness is half credible; they may not have understood, or wanted to understand, the assets and the risks that lurked on (and off) their firms’ balance sheets; but the potential for catastrophe was clear to see, for all who had eyes to see it, and men like Fuld and Sullivan were paid tens of millions of dollars to have or hire such eyes. There were people inside those firms who knew exactly what they were up to. So to claim ignorance or helplessness is to admit to negligence, or to tell a lie. It grated when, last fall, Donald Trump tried to get out of paying debts by claiming that the economic meltdown was a “force majeure”–the legal equivalent, basically, of an act of God–and not a logical outcome of a set of observable circumstances. The real-estate bubble was not a great secret.

What’s most vexing is that those who saw trouble didn’t do more to stop it, and that those who failed to see trouble were ever paid anything at all to run financial firms. One of the central flaws of the system is that naysayers were silenced. If you worked at an investment bank and made a stink about the level of risk, you were likely pushed aside. If you managed money and eschewed leverage, your returns sagged and investors went elsewhere.

This crisis is the culmination of events and trends reaching back, depending on your perspective, four, seven, seventeen, twenty-two, twenty-seven, thirty-eight, sixty-five, or a hundred and two years. The subprime-mortgage meltdown, the subsequent collapse of the wider real-estate market and then of securities based on real estate, and of the firms and funds holding those securities, and of the companies selling insurance against the failure of those firms, and, potentially, of the insurers’ counterparties, and so on: you could say that all this is merely the finale to a multi-decade saga set on Wall Street and Main Street, in Washington, Riyadh, and Tokyo. The causes are technological, mathematical, cultural, demographic, financial, economic, behavioral, legal, and political. Among the dozens of contributors and culprits, real or perceived, are the personal computer, the abandonment of the gold standard, the abandonment of Glass-Steagall, the end of fixed commissions, the ratings agencies, mortgage-backed securities, securitization in general, credit derivatives, credit-default swaps, Wall Street partnerships going public, the League of Nations, Bretton Woods, Basel II, CNBC, the S.E.C., disintermediation, overcompensation, Barney Frank and Chris Dodd, Phil Gramm and Jim Leach, Alan Greenspan, black swans, red tape, deregulation, outdated regulation, lax enforcement, government pressure to lower lending standards, predatory lending, mark-to-market accounting, hedge funds, private-equity firms, modern finance theory, risk models, “quants,” corporate boards, the baby boomers, flat-screen televisions, and an indulgent, undereducated populace. All these factors, very few of them mutually exclusive, conspired to make possible skyrocketing leverage, misperceived risk, and spectacular collapse. To tell the story of them all, in the proper context and detail, will require an Edward Gibbon. The fall of Rome, by comparison, was a local event. Much abridged, a few familiar words will do: debt, greed, hubris.

After Lehman went under, I began calling around, looking for rabbis. Many were happy to talk but not on the record, even though they generally saw their own enterprises as unfairly maligned or above reproach. (This did not always hold true for the employees, past and present, of Bank of America and Merrill Lynch.) The Gnostics of finance are predisposed to secrecy. It’s often hard to tell whether their discretion is valorous, mendacious, guilt-ridden, grandiose, or merely vain. It’s a guise for all seasons. Even candid acquaintances dispense big-picture bromides (“This too shall pass,” or “We’re screwed”), rather than reveal whatever furtive transactional trickery they may have witnessed.

It can be startling to discover how many offices in Manhattan have spectacular views. The first time you gain admission to an aerie in the G.M. Building or some other blue-chip tower and look out across Central Park, SoHo, New Jersey, or Queens, you think that this particular office must be the finest in town, the seat of secret power, the heart of the plot. But the city is full of them. It’s one of the things about tall buildings: you can see a lot, such as other office towers of different vintages, commenced in past booms. The takeoffs and landings at the airports, the shipping lanes, the humans below reduced to units: it is easy to begin to think abstractly about the armature of empire. Sitting up there and talking for hours about pools of securitized debt, and seeing them depicted on dryboards or PowerPoint slides as rectangular blocks, divided into tranches, you can find yourself viewing the buildings out the window as manifestations of that debt–the conversion of financial cunning into steel, brick, and glass. You also happen to be looking at the collateral.

I heard versions of the same story, emphasizing the elements that most flattered the teller’s ideological or professional bias. He tended to say, “It’s very simple,” and then after twenty minutes chuckle a bit as the threads unravelled and his narrative became “Tristram Shandy.” It could be exhilarating to take on the welter of causation and consequence, but clarity was fleeting, more of a mood than an all-encompassing grasp; there must be an endorphin that’s triggered by the call-and-response recapitulation of a giant variegated clusterfuck. When it dissipates, you’re left only with the conviction that our troubles are deep.

A prevailing belief is that there has been some conspiracy on Wall Street to bilk people out of their money. If there was a conspiracy, it was an extremely broad, disorganized, decentralized, and, in some measure, inadvertent one. In other words, there was no conspiracy, unless that’s what you call the establishment of an oligarchy, over several generations and with the assistance of a blinkered populace.

One day, a hedge-fund manager in Europe suggested that I talk to a man named Colin Negrych. He had got to know Negrych a decade ago, when Negrych was the host of an informal nightly gathering for financial eccentrics and renegades at Bice, an Italian restaurant in midtown. “I’m a macroeconomic and geopolitical strategist disguised as a bond salesman,” Negrych told me, when I called him. “I write my clients Bloomberg messages and tell them what they should do.” (He also said, “Every time I read some financial guy talking in the press, I just think he’s a self-aggrandizing asshole. Why would I want to do that?” Eventually, he decided to talk to me, out of the conviction that the dire moment called for candor.)

Negrych is part market philosopher, part screen savant–a nexus of market intelligence. Among his clients are some of the most venerated investors in the world, who prize his discretion and his idiosyncratic advice. He has helped them make billions and has shaved off a bit for himself, most of which he has given away. His employer is a small, privately held broker/dealer called Barclay Investments (which bears no relation to the British Barclays that bought parts of Lehman Brothers out of bankruptcy).

Eleven years ago, Negrych, who is fifty-one, was given a diagnosis of lymphoma, and since then he has worked at home, most recently in a town house he rents near Washington Square Park. He has not gone to the office since at least 2000. (According to Negrych, the firm has made “extraordinary efforts to meet and exceed every compliance requirement related to allowing me to work from home.”) The first time I visited, the door to the street was open. I walked up to the second floor, where I found him in a sparse, dimly lit room, sitting at a giant desk, staring at a pair of computer screens. He had on a plaid bathrobe, moccasin slippers, a baseball cap, and owlish eyeglasses. He was pale and a little fleshy, with a goatee and kind eyes. A colonnade of prescription pills occupied a corner of the desk. He was smoking a cigarette. A humidifier spouted mist.

“There are two things about human beings that I know for sure,” he told me. “One is that everyone wants to be the center of the universe. And the other is that they all want to see what they own go up in value all the time.”

Negrych, I quickly surmised, is not all human: he welcomes a ritual re-pricing with the relish of Colonel Kilgore smelling napalm at dawn. Negrych was the first person I talked to who advanced the notion, which later became more popular, that letting Lehman fail was neither a mistake nor a cause of anything, any more than Pearl Harbor was the cause of the Second World War. For him, the fault lies with the facts–unquenchable debts and the attempts by Lehman and the entire financial system to obfuscate their existence–and not with any capitulation to those facts, however sloppy that capitulation got. Just because it cost a lot of people a lot of money didn’t make it wrong. As he later summed it up to me by e-mail:

Folks were shocked to find the U.S. government unwilling to throw good money after bad at Lehman. This discovery caused market participants to question whether the government would support other large financial entities which they knew to be, or strongly suspected of being, in financial distress, when this support had previously been taken as a given.

And:

Lehman and its bad positions were akin to a dog stumbling around with a chunk of uranium dangling from its collar. It was just cruel to allow it to remain in misery and be a threat to others.

Or, as he put it, quoting the country songwriter Robbie Fulks, “It’s a full-blown chore overlookin’ what’s plain to see.”

The markets were plummeting, and the public’s consternation was in some respects, to Negrych, a disappointment. “There seems to be an unwritten rule that this can’t be allowed to happen,” he said. “So much effort is put into sustaining the stock market and home prices. This whole culture has been set up to see stocks and homes as annual riskless investments. They most assuredly are not.” He had taken off his moccasins; as he talked, he responded to the chirps of incoming messages with flurries on the keyboard. The screens’ glow lit his face and made it appear almost to be floating over the desk.

“Banks are going under because they are undercapitalized. People are going bankrupt. Assets are dropping in value. There is too much debt,” Negrych said. “Jim Grant”–the financial writer–”had a phrase: ‘the incessant degradation of the stigma of debt.’ Debt is the story.”

He went on, “What constituency is there for pessimism? People believe optimism is necessary, an American right. The presumption of optimism is the problem. That’s what creates the debt we have now.” (As a well-regarded French investor said to me one day, with a sigh, “There is no spirit of resignation in the American people.” Most of us would probably regard this as a virtue.)

Negrych moved to the town house in 2005, after selling a capacious Upper West Side penthouse apartment to a television actor for far more than he had paid for it, in 2002. Around the time of the sale, he ran into an acquaintance, a laid-off baker working part-time as a bicycle messenger, who told Negrych that he’d bought a co-op in Brooklyn. A bank had lent him not only the full purchase price but also enough to cover five years of interest payments. “This was a guy who used to complain to me about the price of shampoo,” he said. It didn’t take long for Negrych, a man of skeptical inclinations and immersive habits (to check up on me, he not only read everything I’d ever written but somehow got hold of my wife’s undergraduate thesis and read that, too–something I’ve never done), to conclude that this was a bubble. He started pressing his clients to short housing-related assets in early 2006, and stocks in 2007.

“What Wall Street offers is the continual rationalization that ever-increasing indebtedness is sustainable,” he told me. “It concocts believable, defensible arguments for the prices that they think things ought to be. Financial engineering fills the gap between people’s desires and their wherewithal. So what you have is optimism buttressed by pseudo-science and statistical legerdemain.”

Night had fallen. Negrych, sepulchral in the glow of his screens, had settled into an epigrammatic rhythm–”Wall Street is a roach walking around on a dinosaur”; “It’s the symptom, not the disease”–which, after a while, prompted him to apologize for incoherence. He had taken some morphine. “I’m in massive pain,” he said. “I have a tumor on my spine. I need to get it burned away.”

The roach may survive, but not in the way we have come to know it. It is now commonplace and not entirely bombastic to declare that Wall Street is dead. This refers to the extinction or mutation not only of the old bulge-bracket firms but also of the caste that has found haven and easy riches there, the hundreds of thousands of workers, many of them neither extraordinarily skilled or highly trained, who perhaps mistook the fruitions of cheap credit for proof of their own acumen and flair. What has also run aground is a revolution in finance dating back to the nineteen-seventies.

The term “Wall Street” refers, often, to the matrix connecting the shrinking operations in Lower Manhattan with practitioners in Greenwich, Chicago, London, Geneva, the Canary Islands, Hong Kong, and Shanghai. Or else it stands for an array of firms that now, after the convulsions of last fall, exist in such diminished and altered condition that the term has ceased to mean what it used to. Lehman Brothers, Merrill Lynch, and Bear Stearns are gone, and Morgan Stanley and Goldman Sachs have morphed, technically at least, into bank holding companies–granting them better access to government capital in exchange for more regulatory oversight. Over the past four decades, the old firms had already undergone a tortuous process of consolidation, and transformed themselves from private partnerships into publicly traded companies. They did this to raise equity capital, and to enrich their executives and employees–that is, they found a way to cash out.

The abandonment of the private partnerships was a key ingredient in the world-destroying self-immolation of the last few years. In a partnership, you owned a share of the firm, and therefore a stake in its long-term well-being. In a public company, you were paid each year according (more or less) to your profits or fee generation, regardless of the outcome, down the road, of the deals you did or the loans you made or the assets you took on. You had an incentive to generate inflated or ephemeral gains, and, often, little incentive not to. The amazing thing about the piggishness of the last decade is that, in a certain light, most people, according to the strictures of their self-interest (whether enlightened or not), behaved rationally.

One day, I went to see David Beim, who retired from Wall Street in 1990 to teach at Columbia Business School. He started, in the mid-sixties, at First Boston, during the era of the Nifty Fifty–a frothy time in the markets which hardly left a mark on the culture at large. (Among the icons of 1968, Alfred Winslow Jones may not be the first to spring to mind.) Investment banking was a placid business; the cream went into medicine or the law. It was value added just to call a company’s finance officer, in Cleveland or Tulsa, to tell him his stock price. There were no desktop computers. People used graph paper and calculators, pencils and rulers.

Still, investment banking (underwriting securities, advising companies) was sexier than commercial banking (making loans). In 1977, Beim went to work for Bankers Trust, a commercial bank that was desperate to become an investment bank. “My Wall Street friends were appalled,” Beim said. “It was so second-rate.” Bankers Trust was one of the pioneers at pushing the limits of Glass-Steagall, the Depression-era law that separated commercial and investment banking. At the time, Citibank and J. P. Morgan were quietly trading a new product called interest-rate swaps, which are a form of protection against unforeseen swings in rates. This was among the earliest derivatives, one of the original structured products. Beim said to himself, “This is fabulous. We could make a lot of money with this. I wanna do a swap.” Derivatives made many Bankers Trust executives and traders very wealthy and then, after a series of scandals and bad trades in the mid-nineties, contributed to the firm’s demise. A pattern emerged.

By that time, modern finance theory–the notion, borne of some elegant mid-century mathematics, that one could use models to value contingencies–had taken root in the world of financial practice. It gradually obscured “the sheer brute fact that the results of human activity cannot be anticipated,” as the economist Frank Knight wrote in 1921. Yet anticipate it people did, or tried to, on trading desks and conference calls, amid what Beim called “a rise in complexity.” Mathematicians and physicists, cut loose by the decline of the space program, gravitated to Wall Street and began devising ways to measure, price, and package risk. It was a kind of decentralized Manhattan Project.

There were other factors at work. On May 1, 1975–recalled now as May Day–Wall Street abandoned the practice of charging customers a fixed commission to trade stock. In the past, the firms had taken forty cents for each share traded, regardless of the customer or the size of the trade. Under competitive pressure from discount brokerages like Charles Schwab, firms began lowering their commissions until trading itself was no longer so lucrative. They sought profit in other lines–fancy ways of trading and financing things. An arms race evolved, in which firms developed ever more sophisticated proprietary products, options, swaps, and derivatives. In time, the banks became glorified hedge funds, trading these things for themselves.

In the late nineteen-seventies and the early eighties, a few pioneers, chief among them Lewis Ranieri, at Salomon Brothers, and Laurence Fink, at First Boston, invented and evangelized new methods of securitizing debt. They pooled assets that yielded a regular flow of payments (mortgages, car loans, credit-card receivables, etc.) and then divided the pool into tranches, ranked according to the order of repayment. Pieces of each tranche are sold to investors as securities–a claim on a portion of the payments. The senior tranches get paid back first but yield less. The equity tranches, last in line, get paid more to take on the higher risk of not being paid at all. The idea is to spread and therefore mitigate the risk of lending, and in turn lower the cost of borrowing.

Securitization, invented on Wall Street to make the people who worked there rich, made it much easier for Americans, and America, to borrow far more than they had before. It helped banks get their loans off their balance sheets and free up capital, so that they could lend, and therefore earn, more. It established a new lending apparatus, via the capital markets: the so-called “shadow” banking system. It begat more borrowing, which begat more buying, which begat higher asset prices, which begat more borrowing. In the annals of invention, securitization, on impact alone, ranks somewhere between air-conditioning and irrigation. The price of things came to be determined largely by how easily they could be financed. A long-term decline in interest rates, promoted and abetted by the Federal Reserve, helped create a perpetual-motion machine that encouraged people to borrow, buy, and borrow some more. The savings rate plummeted.

A few years ago, I was signing a check with a blue translucent ballpoint pen stamped with the logo of Commerce Bank, and I realized, suddenly, that these pens were everywhere. I wondered about it for a second and then let it pass.

Commerce, a retail and commercial bank based in New Jersey, was founded in 1973 by Vernon Hill II, who had developed sites for McDonald’s. He aimed to bring the brand loyalty of the fast-food business to the local bank. The branches, which he called “stores,” stayed open seven days a week, often well into the night. There were no fees, and free lollipops and dog biscuits in the lobby. He aimed for what he called “a unique brand of WOW.” The bank was very successful. Hill built for himself and his family one of the biggest private homes in the state of New Jersey. In 2006, the bank gave away twenty-eight million pens, which found their way into the kitchen drawers and jacket pockets, as well as into the collective doodad mind, of consumers up and down the Northeast coast.

The margins in commercial banking are fairly tight. Commerce paid low interest rates, but, still, how was it able to afford the generous service and buckets of free pens? It turns out that the bank had on its balance sheet an unusually high number of mortgage-backed securities. The secret behind the WOW was M.B.S. The pens were, in a way, a precipitate of the shadow banking system, a by-product of securitization. Finding one was a little like stumbling on an empty crack vial in a public park.

In 2007, after regulators took issue with business that the bank was doing with entities controlled by Hill’s family, Hill was forced to resign, and Commerce was sold to TD Bank Financial Group. Commerce is gone. You may still come across a pen now and then.

“I have some esoteric ideas,” Simon Mikhailovich told me. We were in a conference room in his offices, facing the Empire State Building. Mikhailovich, who emigrated from the Soviet Union in 1978, is an investment-fund manager who specializes in distressed structured credit, including collateralized debt obligations (C.D.O.s), formerly high-flying and now leaden assemblages of securitized debt. He was among the pioneering misfits who, in late 2005, sensed that the loans underlying many C.D.O.s, subprime and otherwise, were lousy and unlikely to be repaid. “Leveraging overpriced assets never worked for anyone,” he said.

He applied the analogy of poultry. You can turn a bunch of whole chickens into packages of chicken parts, of ascending quality, from gizzards to breasts, and charge a premium for the best cuts. The butcher gets paid, and the shopper gets what he wants. The problem was, eventually, that gizzards were packaged as breasts. And then there was the salmonella. This reminded me of a cruder fowl-related C.D.O. critique: “You can’t make chicken salad out of chicken shit.”

Mikhailovich’s roster of culprits begins with the desktop computer, which encouraged tweaking the data and models until they said what you wanted them to. “If the numbers didn’t work, then you made them work,” he said. “There is the seduction of those huge profit projections in the last column.”

Mikhailovich reserves his greatest scorn, however, for the ratings agencies–principally, Moody’s, Fitch, and Standard & Poor’s–the ones that determine a debtor’s creditworthiness. Their work is necessary; no one would be able to root through the contents of every C.D.O. on his own. Banks and bondholders need food tasters. But the ratings agencies were paid by the packagers of the C.D.O.s to issue the ratings that made the C.D.O.s attractive–and they routinely put AAA, or almost zero-risk, ratings on tranches of C.D.O.s which consisted of loans or mortgages that soon went bad. It is true: the peddlers of the chicken shit paid to have it magically pronounced chicken salad, a conflict of interest that most investors ignored. The recipe may have originated in the mathematical models of the banks, but it acquired its irresistible allure with the acquiescence of the raters, whether it was winking or pie-eyed. “They were the ultimate fulcrum, the enablers,” Mikhailovich said.

One reason that the ratings were so important–besides laziness–was that the regulators declared them so. A series of regulatory refinements, culminating in 2004, in a set of rules known as Basel II, enshrined the raters as semi-official arbiters of creditworthiness. According to the regulatory regime, banks could take on more leverage with less capital in reserve if their assets were rated AAA. “Banks developed an insatiable demand for AAA credit risk,” Mikhailovich said. “But there are only so many companies out there that qualify for AAA rating.” And so the international debt cartel built laboratories for the creation of synthetic debt–credit-default swaps, which weren’t debt but, rather, bets on other debt. These were also pooled and sliced into tranches that, too often, acquired the AAA stamp. Securitization had turned into alchemy.

“Financial engineering tapped into a strain in the investor’s mind by replacing uncertainty with the appearance of certainty,” Mikhailovich said. Certainty came in a guise of inscrutability; the products designed to reassure also happened to befuddle. Many of the people responsible for evaluating the engineering considered their mystification to be further proof of its brilliance. They were, like Bernie Madoff’s investors, comforted by their own ignorance.

The shadow banking system went haywire during the housing boom. Each firm had its structured-product samurai, the latter-day equivalents of the Milken-era junk-bond evangelists. The mathematical models indicated that there was very little risk, even if common sense said otherwise. The dot-com bubble of the late nineties was, in retrospect, a lesson in what happens when markets defy reasonable metrics or common sense–when the participants mistake a run of speculative good luck for, as Alan Greenspan memorably put it, “a new paradigm.” The C.D.O. machine that flourished in the middle of this decade took the tendencies but not the lessons of that period and applied them to the housing market–and thus to the core of our credit system, and our lives. It sucked in ordinary Americans. “Securitization is like fertilizer,” Mikhailovich said. “You can grow tomatoes, or blow up buildings.”

Mikhailovich believed that you could still invest in C.D.O.s; you just had to do your own work. “Have you ever seen an indenture?” he asked me. I pictured Gordie Howe putting his teeth in a glass for the night. Mikhailovich let a bound sheaf the size of an old stereo receiver drop on the table with a thud. “I’m pretty sure not too many guys read these.” It was the C.D.O.’s governing document, detailing what’s inside it, and who gets paid (or not paid) when and how–a configuration called “the waterfall.” Mikhailovich’s maxim was “Know your waterfalls.” It was the key to getting the right poultry parts at the right price.

I thought back to something David Beim, at Columbia, had said about securitization: “We built all of these elegant projections. They were good ideas. But they were never designed for bad paper. Having started as a way to make banks safer, they became a machine that said, ‘Feed me.’ “

And so debt was created to sate the machine. “We’ve created more assets than there are hands to hold them,” Beim said. “And we cannot all de-leverage at the same time.”

The banker had come to Barclays, the London-based bank, to help build its investment-banking business in New York. After Lehman went bankrupt, Barclays bought Lehman’s North American investment banking business. The Lehman guys started getting rid of the Barclays guys. For the banker, it grated to be supplanted suddenly by the refugees, the ones who, in his reckoning, had destroyed their own firm and with it the global financial system.

After a few weeks, the banker was called in for an interview with his new boss. When he walked in, the new boss was watching a congressional hearing on television. The witness was a Wall Street executive. The new boss held up his hand for a moment, so that he could listen to the executive make a point. The banker, hoping for his new boss’s undivided attention, and perhaps an irony-free interview, suggested they reconvene later.

“No, sit down,” the new boss said, and then asked, “So what do you do?”

The banker began to explain why he, who had been at Barclays for years, should be employed at his own firm. Before he could finish, the phone rang. It was a personal call, having to do with golf. As the boss talked, the banker watched the executive on TV: tsunami.

When the banker was fired, a few weeks later, his first reaction was relief: it’s better to know than to wait. Then came frustration and anger. “Part of my termination agreement is I can’t do any harm,” the banker said. He had taken to calling his wife “my new best friend.” He was trying not to infringe on her routine.

A debate has roughly formed between those who blame the meltdown on the system, rigged up over years and decades, and those who vilify the people who most egregiously exploited the flaws in that system, however substantial those flaws may have been. Both sides may be in agreement that, in the end, human nature is to blame, but the question remains whether, ultimately, our predicament arises out of the venality of the many or of the few. Was it Wall Street in general–or even its clients, and the debt-hungry masses–that behaved abominably, or just a scattering of scoundrels?

Margaret Atwood, in her recent book “Payback: Debt and the Shadow Side of Wealth,” notes that in Aramaic the words for “debt” and “sin” are the same. When we ask for forgiveness from our trespasses or call Christ the Redeemer, we are employing, as she puts it, “the language of debt and pawning or pledging.” She goes on, “The whole theology of Christianity rests on the notion of spiritual debts and what must be done to repay them, and how you might get out of paying by having someone else pay instead.” (By this standard, America really is a Christian nation.) She adds, “It rests, too, on a long pre-Christian history of scapegoat figures–including human sacrifices–who take your sins away for you.” For the repayment of our debts, we look to the government; the TARP, you might say, is Jesus.

As for expiation, we endeavor to find the worst offenders, whose transgressions can stand in for everyone’s. Atwood discusses a medieval character called a Sin Eater, an outcast who took on the sins of the dying and bore them until another Sin Eater–the greater fool–came along to take them off his hands. (If Sin Eaters existed now, someone would securitize them.) So far, Bernie Madoff, John Thain, Dick Fuld, Joseph Cassano, and even Jim Cramer, to name a few who have been cast in the role, have proved insufficient. Their own trespasses aren’t nearly broad enough to take on the whole burden of the fraud, avarice, arrogance, and misjudgment that has laid low the world.

There are other candidates and conspiracy theories. One concerns Goldman Sachs and the Treasury’s dispensation of bailout funds in the firm’s direction. Goldman may be the closest thing we have to an Illuminati. The signs of favoritism, on the part of Henry Paulson, the Treasury Secretary and former Goldman C.E.O. (toward not only Goldman but also Merrill Lynch, run by a former Goldman colleague, and A.I.G., now run by a former Goldman board member), may merely be coincidental, or simply a product of affinity and proximity, rather than a plot, but it is no less infuriating to the taxpayers, to say nothing of the employees of Lehman and Bear Stearns, who watched the government, directly and indirectly, fork over to Goldman (which has continued to claim that it does not need help) sums that might have saved these other firms. But even the most extreme rendering of any alleged skullduggery there, or at A.I.G., or at Lehman, or at Bear Stearns, captures just a portion of the blame.

In my corner-office conversations, the finger often wound up being pointed into space, in the general direction of the natural order. If mistakes were made, not all of them could have been innocent, but few people inside the business seemed to have the stomach for the sorting, as though it might lead to an indictment of free-market capitalism, and of their own happy place inside it. “I had a fiduciary responsibility” can sometimes sound like “I was just following orders.” Several people I talked to predicted that there would be show trials but then faltered at the thought of who the defendants could possibly be.

But we try. One afternoon, I went to see Michael Steinhardt, the hedge-fund pioneer who came to prominence in the late sixties, and who shut down his firm in 1995, although he still has an office of people to oversee his own trading and investments. I’d heard that he was on a mission to assign blame. When I arrived at his office, he was flipping through a gardening catalogue while keeping an eye on a trading screen. “Unless the public understands why this happened, until it can identify the villains, you can’t recover from it,” he said. “If you don’t have someone to blame, other than some schmucks with fancy bonuses, you won’t have a recovery.”

Like many financial titans, Steinhardt favors a catechistic conversational mode, so it was hard to get him to throw out names. My opening propositions were unsatisfying.

“Alan Greenspan? He may have been stupid but not pernicious,” Steinhardt said, recalling that Greenspan, in the late sixties, as a consultant, used to make presentations to his firm. “I didn’t find him to be anticipatory or perceptive,” Steinhardt said.

I brought up Sanford Weill, who built Citigroup into a financial-services giant and incrementally circumvented, and then led the push to repeal, Glass-Steagall. “I was at a party with Sandy Weill,” Steinhardt said. “I said, ‘Sandy, who are the villains?’ He said, ‘Huh? I didn’t do anything wrong. I just picked the wrong successor.’ ” Steinhardt smiled.

He was quicker to indict the political class. The ignorance of politicians in matters financial is a source of constant contempt on the Street. One discovers that Wall Street is as keen to blame Washington as Washington is to blame Wall Street, which suits them well as co-dependents. Each knows the corruptibility of the other, even if each often seems to misunderstand the other’s ways and aims. Each is persuasive.

During the fall and into the spring, I went to see Colin Negrych once a month or so to listen to him talk about macroeconomics, market dynamics, and human frailty. His ruminations became a kind of bass line against which most of the events of these months began to make some kind of sense, or no sense at all. I sat on a couch, opposite his desk, while he kept his eyes mainly on his computer screens, absorbing Bloomberg headlines, messages, and graphs. Sometimes the sound of a clarinet would drift up from the apartment downstairs of a jazz musician, who records for a label that Negrych owns.

Negrych’s background is unusual, even if you allow that Wall Street isn’t quite as homogeneous as all the blue shirts and fraternity haircuts lead you to suppose. He was reared in Toronto. When he was ten, his mother died of cancer and his father, also ill, moved to a nursing home, and Negrych became a ward of the province. He ran away from his group home and, after some years on the streets, went to work in a nickel mine in northern Manitoba. Back in Toronto a few years later, working as a bouncer at a bar, he met a girl who was heading to New York for college, and he followed her there. He got jobs in restaurants and bars–for a spell, he was on the night shift at Serendipity 3. One weekend, on a visit to a new girlfriend’s parents’ house, in Connecticut, the family gave him a hard time for not having read “Moby-Dick,” and he decided that he’d better go to college. With a high-school equivalency degree, he wandered up to Columbia, where he found himself in the School of General Studies. Negrych resolved to study mathematics.

Like many bright and hungry young men and women of the era, he instead wound up in the training program at Salomon Brothers. He joined the class of 1985, the one that Michael Lewis described in “Liar’s Poker.” After Salomon, Negrych went to First Boston, where he worked in fixed-income arbitrage with Dexter Senft, who helped invent the mathematics behind mortgage-backed securities. Negrych went on to work, in various capacities–proprietary trading, modelling exotic derivatives–at Lehman Brothers (for less than a day), C.I.B.C., U.B.S., Societe Generale (where one of his bosses advised, “The clients are like the geese. We stuff their livers”), and another French bank, called C.C.F. The French eventually tired of him–”I’m what’s known as a management challenge”–and so, having made a pile of money, he took some time off. During this period, he patented a screwtop-controlled viscous-material dispenser. In 1997, he joined Barclay and decided to focus on making macroeconomic bets. “You only had to get four trades right a year,” he said. Then he got sick. Told by his doctors that he was likely to die, he gave the rest of his money away. But he didn’t die. This was good, except that he had no money left. “People never tell you to save for a sunny day,” Negrych said.

He made an arrangement with Barclay that gave him a share of the money he generates for the firm. It has been lucrative, though unspectacular by the standards of the age. He’s made tens of millions since the Nasdaq crash of 2000. He decided, some years ago, that making money for its own sake was no longer interesting, but he loved the markets and felt he had a gift for interpreting them.

In his days at other firms, Negrych had cast himself as an impediment to unsaintliness, “someone to look out for people, not in the sense of helping them get rich in a bull market but in that of preventing them from hurting themselves and others. The sad thing, I realized, is that there was no way to achieve this.” He developed a dim view of human behavior in times of prosperity. “I decided to profit from them to the greatest extent possible to give myself the wherewithal to deal with the agony that they would ultimately produce.” He decided to be Robin Hood, rather than Mr. Spock.

Negrych belongs to a recondite dispersion of market intellectuals who have an affinity for the ideas of the Austrian school of economics (of von Mises, Schumpeter, Hayek, et al.), such as the axiom, long scorned but now more widely appreciated, that credit booms must necessarily lead to credit busts–that there is such a thing, basically, as gravity. Some, but far from all, of his views may be familiar to readers of economists such as Robert Shiller and the Nobel Prize winner Paul Krugman, at least as to the nature of the ailment, although Krugman thinks that the stimulus has been too small, rather than, say, a step on the way to hyperinflation, the blind printing of money. (One investor told me that he had looked into buying the private Swiss company that makes the ink used on dollar bills: “They told me, ‘We no sell eet.’ “)

Negrych believes that there is a commercial-financial complex, analogous to the military-industrial complex (merchants of debt, rather than of death), which promotes borrowing and spending, and spins indebtedness into fool’s gold. You cannot borrow your way out of debt. Printing dollars to prop up failed or failing institutions is a waste of time and money. The government should stick to guaranteeing deposits and regulating the markets properly. It should have let A.I.G., among many others, go bankrupt. The people and the institutions that took foolish risks should be forced to suffer the ill effects. The banks should get back to being “boring”–take deposits, make loans, and give up on financial engineering and speculation. The government should be encouraging its citizens to save, not to lend, borrow, speculate, and shop. The culture has come to favor–even demand, if you consider the middle-class dependence on home equity and 401(k)s and 529s–financial speculation as the cornerstone of a strategy for prosperity, at the urging of the government. People will need to sell stocks to pay off their debts. The “equity culture” is dead. And, finally, this: The current course of “denial and disinformation” will, if not corrected, produce a real depression–the cleansing we need and deserve.

As the weeks went by, Negrych sent me hundreds of e-mails, cantankerously relating bits of news, data, or commentary. The pace of his e-mails accelerated when the market was rallying. He regarded up days as reflections of mass delusion (“Even a few days without bad news quickly leads to the nucleation of assumptions about endless days of good news to follow”) or of official intervention; he was not immune to the conspiracy theory, whispered by some noninterventionists, that the government, in the interest of national security, may have established some kind of secret program to buy stocks, to juice the indices. All those late-session comebacks: Negrych smelled a fix. As he wrote me one day, when the global markets seemed to turn on a dime, “Clearly, someone has decided to take a stand right here in the major stock indexes. We’ll find out soon what weapon they possess, brick or bazooka.”

I happened to go by Negrych’s on the day after Bernie Madoff was arrested. A snowstorm gave the Village an anachronistic, muffled Cafe Wha? air. When I arrived, Negrych, thinking of Madoff, quoted a line from a friend: “Wall Street takes your money and their experience and turns it into their money and your experience.”

It wasn’t hard to guess what had compelled Madoff’s investors to trust him. “The willing suspension of disbelief,” Negrych said. It was a high concentrate of what had gripped the financial markets during the boom. “The idea that you can have something for nothing–it’s human nip. It’s the hereafter, here on earth.” Less clear was what had driven Madoff. If it had been money alone, what had he done with it, and why had he not run off with it? Madoff apparently hadn’t taken fees, a dubious abnegation. No one on Wall Street forgoes his piece, be it rightful or not. What Madoff craved most of all, Negrych surmised, was prominence, of the kind that can only be bought. “There’s an innate tendency among the elite to idolize men who make a lot of money,” Negrych said.

Our soaring debt isn’t entirely a moral or temperamental failing, a flaw in our national character, or a Wall Street scheme. One afternoon, on a visit to the offices of a money-management firm (view north, overlooking Central Park), I was introduced to a Columbia professor and economist named Bruce Greenwald, who has been called “a guru to Wall Street’s gurus.” As I began to recite some of what I’d come to believe about America’s native appetite for indebtedness, and our struggle now to get free of it, Greenwald cut me off. “De-leveraging is a slogan,” he said.

He explained that we are, in some respects, the victims of a structural imperative reaching back to the waning days of the Second World War. The Great Depression in Britain, he said, started in the late nineteen-twenties, owing to structural deficits in the nation’s balance of payments, a result of the pound sterling’s traditional role as the world’s reserve currency. Bretton Woods, the global economic conference in New Hampshire in 1944, replaced the pound with the dollar.

This meant that debts tended to be denominated in dollars, and other nations had to hold dollars in reserve, to pay them off. Not having dollars would expose your country to the risks of currency fluctuations. And so other countries coveted dollars. To get them, they sold goods. There was, therefore, in the Bretton Woods arrangement, a structural demand for current-account surpluses, and for someone to eat up all those surpluses. We had to be the consumer of last resort. “We’ve been living beyond our means for the sake of the world,” Greenwald told me. “Where else would all that crap go?”

Barclay Leib, a derivatives trader and hedge-fund consultant, told me that some years ago his son, who was five at the time, asked him what his job was. Leib thought about it for a moment, and then pointed down the street. “You see that Toyota? Well, we pay the Japanese twenty-five thousand dollars for it. Daddy’s job is to get the money back.” As he told me, “The Japanese invest it here and make mistakes.” He added, “Mrs. Watanabe was then and still is groping for yield.”

They make, we take. And then we find ways to pay for it all. Our prime asset, over time, became our financial acumen. It represented an ever greater part of our economy, our political system, and our interaction with the world. “What’s our best export?” Leib said. “Scrap metal? No. Hedge-fund managers. Financial creativity. We’re good at it. We keep the cycle of money going.”

This flawed arrangement may be nearing its breaking point, thanks to our reckless spending, expanding debt, and increasingly questionable creditworthiness. A few recent Treasury auctions went poorly, and China has floated the idea of an alternative global currency.

I recently revisited Morris Bishop’s concise history of medieval Europe, which begins with a winsome rejection of the “unfortunate term” that gives the book its title, “The Middle Ages.” Bishop observes that the people of the period “did not know that they were living in the middle; they thought, quite rightly, that they were time’s latest achievement.” The Middle Ages began with the fall of Rome. “Whatever the cause, the later days of the empire were marked by discouragement and fear, by what has been well termed ‘a failure of nerve.’ The Roman Empire was like a declining business, whose program is retrenchment and retreat, whose ventures are desperate, whose employees can only shrug their shoulders and hope that the old enterprise will last out their time.”

The salesman was an English major without an M.B.A., a burner of both candle ends, who, in his mid-twenties, submitted to the lure of Wall Street. He rose quickly; he was bright and personable, competitive and cocksure. After a few years, he settled in at one of the big firms, where he helped develop a profitable line in equities. In 2003, he used an offer from Merrill Lynch to dramatically increase his pay. Not long afterward, Merrill offered to raise it again. It was hard to resist. A high-ranking Merrill executive invited him to breakfast at the Ritz Carlton in Battery Park City, where Merrill was based. The executive was seated in the middle of the restaurant, waiting at a table for two. He didn’t stand to greet the salesman or, when he indicated that it was time for the salesman to go, to see him off. As the salesman was walking out, he saw the waitstaff reset his half of the table and usher in another prospect. He realized that he was just one unit in a robo-hiring spree. Merrill was ramping up.

The salesman’s boss at his old firm was a trader who in matters of personal finance preached extreme risk aversion. At bonus time, he’d tell the salesman, “I’m not going to pay you unless you promise to sell your stock [in the firm] as soon as you can and buy munis,” meaning municipal bonds. When the salesman told him about Merrill’s latest offer, the boss said, “Go. Take the money. The guy’s an idiot. He’s paying you too much. Either they’re really stupid or they have so much money it doesn’t matter.” Being the former, they mistook themselves for the latter.

People who have worked on or near a trading desk tend to refer to any decision, any commitment, any choice in life, as a trade. “I did the trade for money, so I deserve what I got,” the salesman recalled recently. What he got was a window on the end.

Once Lehman Brothers went under, it became clear that Merrill, too, was in deep distress. Its chief executive, John Thain, sold the firm, in order to save it. The buyer was Bank of America, a giant bank based in North Carolina that aspired to Wall Street dominance. As the fall wore on, and the economy soured, and the share prices of banks and brokerages, including Merrill’s supposed white knight, collapsed, the salesman and his colleagues began to realize that this was not likely to end well. They consoled themselves by cheering Lehman’s demise, out of Schadenfreude and superstition that its death might appease the gods. Then a guy on the desk did a spreadsheet analysis of the firms’ relative predicaments, and they all realized that the Lehman guys still had jobs, while the Merrill guys were about to lose theirs, and their stock price was fast approaching zero. It was Schadenfreude’s revenge. As luck would have it, the salesman had shorted Lehman–he was forbidden from shorting his own stock–and invested the proceeds in a hedge fund. But then the hedge fund got clobbered.

By Christmas, the salesman and his colleagues had become zombies. There was less and less work to be done, and little sense in currying favor. Some guys were going to the gym twice a day. The salesman occasionally snuck out to the Regal Battery Park 11, the movie theatre across the street from the firm’s headquarters. He saw “The Curious Case of Benjamin Button” and “Gran Torino” and “Slumdog Millionaire.”

The firings accelerated. There was a tradition on the trading floor at Merrill to stand and applaud colleagues who had been fired–or RIFfed. (RIF stands for Reduction in Force.) After a while, these impromptu tributes were breaking out several times an hour, State of the Union-like, and the ovations grew queasy and halfhearted.

The salesman’s boss was jittery, but he urged his charges to hang on and hope. The salesman thought of “The Trial,” when Josef K., on the verge of execution, has a self-generated fantasy of rescue–”Who was it? A friend? A good man? Someone who sympathized?” The boss quickly veered from denial to abject self-pity, and began pestering the salesman for scuttlebutt and support: “What are they saying about me on the floor?” The boss, called in by his bosses to discuss which of his charges he’d fire, had picked up on chatter that he’d go down himself, which would mean death for the salesman. The boss came out of the meeting visibly distraught. “What am I going to do?” he moaned. “I’m going to have to move to Minneapolis. What’s my wife going to say?” The salesman thought of “Richard II”: “My large kingdom for a little grave, a little little grave, an obscure grave; For God’s sake, let us sit upon the ground and tell sad stories of the death of kings.” He grabbed his boss by the shoulders and told him to get control of himself, thinking, Behold, the world’s unhappiest millionaire. As he comforted the boss, he overheard his secretary lamenting the monthly commuter-bus pass she’d just bought; if she were fired, too, that cost was sunk. He was ashamed.

Diminished pay and government oversight had rendered the miseries and indignities of investment banking no longer endurable; it was hard enough to will himself to do it when he was making millions. For a couple of hundred thousand, forget it. His stock was worthless; the work had dried up; the firm had degenerated into a job-preservation free-for-all; and he and his peers were being depicted everywhere as crooks and thieves.

On the day that the salesman was fired, he came home, prepared to finesse a conversation with his children, but his six-year-old daughter had overheard her mother talking with a friend on the phone, and so, when he walked in, she announced to a playmate, “Daddy’s coming home today because he got fired and his firm is going bankrupt.”

The most frequent responses were “Let me know if there’s anything I can do” and “I don’t know what to say.” This last one annoyed him, because of the way it seemed to conflate joblessness with death or disease. He said he felt liberated, but the old question of where do you see yourself in five years left him stumped. There was a part of him that wanted to move to Brooklyn or to another state–he could be a teacher and a coach. His wife preferred that he get an interview at Goldman Sachs. He tried to persuade her to put their apartment on the market, if only to gauge its value, and then learned that there were six others for sale in the building. He had missed the trade.

Michael Cembalest, the chief investment officer at J. P. Morgan, writes a weekly memo, called “Eye on the Market,” which the firm sends its clients. Usually, Cembalest discusses various investment and market issues, but one morning in February, before getting on to the “really terrible economic news of the week” (home prices, consumer confidence, layoffs, earnings–down, down, up, down), he discussed what he called the Conversation, a term he’d learned from a client.

The Conversation can take place between a husband and a wife, or a parent and a child. Its subject is affordability; its only requirement is honesty, and rudimentary math. In some cases, the Conversation, or the underlying reality, can lead to estrangement or divorce; an absence of money will expose differences in values and taste.

In his memo, Cembalest enumerated, as a guide to his clients, his own household expenses, which, relatively speaking, were modest. He divided them into the categories “mandatory” (mortgage, taxes, transportation), “discretionary” (distilled spirits, gym memberships), and “frivolous” (electronics, jewelry, art work). He concluded, “Like the federal government, mandatory spending made up seventy per cent of our total. So to make an impact, we decided to reduce discretionary spending by fifty per cent and frivolous spending by eighty-five per cent.” (He later emphasized to me that he and his wife made these decisions together.) Cheaper booze (“non-brand name spirits are half the price”), cheaper jewelry (“this year I bought a ‘Reef Fish Identification Guide’ for my wife’s birthday”). He advised that “a numerically based discussion was more productive than a rhetorical one.”

These numbers do not lie or flatter. Up and down the line, obligations loom and prospects dim. Wall Street’s tribulations have brought drastically straitened circumstances to nearly every profession. Whether you work for a contractor, a vender, a hospital, a restaurant, a transit system, a high school, a newspaper, a charity, or yourself, the Conversation likely involves a new and irreconcilable calculation of commitments: perhaps even an abandonment of a college education or the loss of a health-care plan.

As for the co-op classes, the Wall Street set, it can seem that the loss they fear most is the loss of face. No one seems to want anyone else to know. In one sense, there is less shame in failure now, because it is widespread and undiscerning. Still, it smarts. There are successful circles in which success (to say nothing of money) isn’t everything, but without it you’d better bring something else. Charm, wit, talent, kindness, and generosity certainly help, but only if they complement characteristics that could be more readily converted into social or professional capital. Without the fancy job or the big nut, it gets harder to hang around.

Economists like to draw lessons from Japan’s lost decade–to see in its example of zombie banks, futile half-measures, mass denial, and a moribund Nikkei a primer in how denial doesn’t pay. But human nature holds sway, down even at the level of the neighborhood. In Japan, during the long stagnation, men who had lost their jobs but couldn’t face the shame of telling their neighbors would dress for work and then spend the day in the library or the park. Around here, the social pressures are more subtle; men are not afraid to appear at private-school pickup, in jeans, although they often make a show of maintaining BlackBerry vigilance. See them at soccer practice, pacing the sidelines, gesticulating into their earpieces. Confidence is essential to job-seeking.

Already the value of their skill set is in steep decline. There will be fewer seats at the table. That means that a lot of college-educated well-off white-collar professionals will have to find something else to do. People will have to work harder for less. Some Wall Street exiles find themselves interviewing for jobs that pay one-eighth as much as their old one. When your self-worth is based on your salary–a correlation as well observed as it is widely denied–it’s hard to adjust to being 12.5 per cent of the man you used to be.

It has been fashionable in recent years to use the terms alpha and beta, which in investing refer, respectively, to absolute performance and relative performance, in ordinary conversation (as in, “We always give the beta”). Well, beta-wise, things look a little better, in the self-evaluation department. Whether we’re talking nations (the United States economy is a disaster, but others are even worse) or neighbors, beta is the more reassuring approach these days, and is what allowed people to say, this winter, “Down thirty is the new flat.” Alpha-wise, however, the wreckage is widespread. John Maynard Keynes had this to say about the appropriate temperament: “A ‘sound’ banker, alas! is not one who foresees danger and avoids it, but one who, when he is ruined, is ruined in a conventional and orthodox way along with his fellows, so that no one can really blame him.”

By spring, the conventional wisdom had quickened. Self-preservation masqueraded as common sense. In the wranglings over solutions, members of the political establishment sought tactical advantage, and yoked popular opinion to their career calculations, drumming up outrage when it suited them (A.I.G., Chrysler) and then ignoring it when it did not. The asset-owner class conjured whatever conviction it could to protect the remaining value of its decimated investments. Both sought, by all means necessary, to reflate risk-asset prices–houses, stocks–as though the low prices were the disease itself, rather than a symptom. Above all, they promoted confidence.

The wires were rife with attempts to bury the bad and turn up the good. Regulators were softening the widely resented mark-to-market accounting provisions that had, in effect, compelled banks to acknowledge, rather than obfuscate, how toxic their toxic assets might be. When Secretary Timothy Geithner announced the details of the Treasury’s plan for financing the private sector’s purchase of toxic assets from the banks, the Dow rose more than four hundred points. The warm reception suggested flawed conception; Wall Street liked the plan because it was generous to Wall Street. That it might also be a transfer of wealth from future taxpayers to incompetent or opportunistic financiers–an extreme instance of privatizing gains and socializing losses–did not trouble the equity markets, which generally don’t fret much over fairness.

One afternoon not long ago, I asked Colin Negrych if there had been any capitulation, among market participants and ordinary citizens, to what he and other dour prophets continued to describe as a catastrophe of epochal proportions. “No,” he said. “People are still inclined to view this as a temporary disruption.” Even peers who were predicting dire outcomes didn’t seem to believe that they would come to pass. Decades of experience had taught them to buy on the dips. “People are clinging to the idea that there is some ‘they’ out there that can reverse this, that the Fed will arrest and reverse this,” he said. “Having this thing normalize is the worst nightmare for the powers that be.

“The bear market is integrity,” Negrych went on. “It’s honesty, transparency, and common sense.” This was as much a moral declaration as a mathematical one. Truth in accounting–the proper recognition of losses and liabilities, the acknowledgment of inconvenient facts–is a kind of virtue. Credit relies on a foundation of trust, which comes of honesty and fair dealing. The bull market, we’ve learned, did away with these things. Enthusiasm, in the presence of lucre, tends toward rapacity.

It became hard to argue. People kept sending me grim research reports from investment firms–the financial world’s equivalent of viral YouTube links. One of them, from Bridgewater Associates, spent ten dense pages enumerating the conditions common to depressions, and then declared, “That, in a nutshell, is our template.” Nutshells, these days, are the size of swimming pools.

In spite of such tidings, the stock-market rally held. Optimism sprouted. How was one to reconcile the dismal fundamentals and statistics, and the private pessimism, with the assertions by the banks, the Feds, and the media that deliverance might be at hand? Houses were starting to sell in Sacramento. The rise in unemployment was slowing. The banks, for the most part, had passed their stress tests, albeit with gentlemen’s C’s. (There was also a matter of seventy-five billion dollars.) Women’s Wear Daily put smiley faces on its front page. The salesman had found another Wall Street job. Might the paper that we’d laid over the abyss be sturdy enough to convey us across?

The market scolds saw the positive signs as jabberwocky, or else mere accounting tricks. (Goldman Sachs, for example, had, as part of its conversion into a bank holding company, changed its fiscal year, so that its results for December, a gruesome month, vanished from its earnings calculation. Abracadabra.) The skeptics worried that the crisis was mutating into a virulent strain of delusion, a pretext for the preservation of the old status quo. The presumption was that staving off near-term pain would lead to ever more spectacular collapse. But who knows? Maybe it won’t. Divination is fraught, facts being merely what we make of them.

Another morning in the sky, another corner office–a view south and east. The occupant was a financier at a prominent private-equity firm. He was drinking herbal tea, feeling worn down. The office was large and typical–caricatures and tombstones commemorating old deals, a computer screen filled with figures more red than green. When I asked him about the price of a particular stock, he gave me a sickly look and said, “You’re still in equities?”

Personally, he’d been short the market for two years. The trendy trade, and the one he was fond of, was ticker TBT, a way of shorting the twenty-year Treasury, in anticipation of inflation. (“There is nothing as inflationary as the whiff of deflation,” one fund manager told me.)

The issue of the day and the week and the season was the insolvency of the banking system. “When you are leveraged twenty-five to one, if your assets fall by five per cent, you are technically insolvent,” he said. “The increase in leverage worked because, like a Ponzi scheme, it was ramping up the value of the assets that it was financing. That all worked, until it didn’t.”

It was time for a conference call with a hedge-fund manager who was particularly pessimistic, and had correctly called the subprime meltdown. “This guy is doom, doom, doom,” the financier said. A succession of voices came out of the speakerphone device. The financier greeted everyone, and then pressed mute and began to wander around his office, as the hedge-fund manager laid out the familiar gloomy statistics: trillions of dollars of excess debt, not enough money in the world to soak it up.

“We all know how we got here. Let’s talk about what’s going to happen,” he said. “Prices of all assets will decline, regardless of the stimulus.” The silver lining, if you could call it one, was that the rest of the world was in worse shape. The financier occasionally nodded. He said to me that he expected the European Union to fall apart, and with it the euro. A voice on the speakerphone said that Swedish banks were struggling–bad loans in Latvia. The United States was using currency-swap lines to inject capital into other countries’ ailing banks. “We’re not only propping up our own mediocrity,” the voice said. “We’re doing it with the whole world. And as fiduciaries we can’t invest in a market that’s propped up.”

“Mad Max time, baby,” the financier said, before double-checking that the mute button was indeed on.

The voice went on, “If the long bond starts rising, we’re done. That’s the Armageddon scenario.” Someone mentioned a jobless rate of up to twenty per cent. “How awful is that going to be?” one voice said. There ensued talk of riots in China and Greece, and the relative merits of gold and canned food.

There was no anxiety or even amazement in their voices, just a kind of war-room self-satisfaction. A voice said, “Capitalism without bankruptcy is like Christianity without Hell.”

The financier had heard enough. He was eager for some air. Without signing off, he grabbed his coat and walked out. The streets were busy; nothing seemed amiss.

Nick Paumgarten

This article focuses on the economic aspects of German European policy in the 1950s and raises the question whether the economic system of the Federal Republic of Germany, “Soziale Marktwirtschaft” had any impact on the European policy of the West German state. It argues that Social Market Economy as defined by Ludwig Erhard influenced German European policy in certain aspects, but there was a latent contradiction between the political approach of Konrad Adenaner and this economic concept. Moreover, this article shows that West German European policy was not always as supportive for European unity as it is often considered.

Keywords: European integration; Ludwig Erhard; Konrad Adenaner; Common Agricultural Policy; Soziale Marktwirtschaft

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“In the beginning was Adenauer” is a famous coined dictum by Arnulf Baring, a German historian. (1) Baring’s principal argument was that due to the political system of the Federal Republic of Germany (FRG), the chancellor played such a dominant role in the decision-making process that he influenced all important political decisions in the early 1950s. This also applies to the foreign policy of the early Federal Republic-especially European policy.

Historical research has evolved since the early 1980s, however, when Baring published his book. Konrad Adenauer’s dominant role in the decision-making process is still an unchallenged finding, but today we know that there were several competing conceptions of European integration policy circulating among the political and economic elite at that time. In fact, at least three general approaches can be identified. First, was the pragmatic political conception of Adenauer himself, (2) aimed primarily at the integration of West Germany as an integral part into the western world, which he associated with values such as human rights, democracy, individual freedom, and the Christian religion. According to Adenauer, the actual form of this integration was only a question of secondary importance. What was crucial in his eyes was that integration should be accompanied by reconciliation with France and supported by the United States whose military power seemed to be the only guarantee against Soviet aggression.

A second conception could be called the federal or constitutional theory. It was supported by the leading diplomats of the Foreign Office (Auswartiges Amt, and advocated a federation, the “United States of Europe.” All member states should delegate part of their national sovereignty to the new federation that was to become a new actor in world politics on the same level as the U.S.A and the Soviet Union. The most important representatives of this conception were Walter Hallstein, the Secretary of State in the Foreign Office and Karl Friedrich Ophuls, the head of the European Department. (3) As both were professors of law, they considered the construction of a new political entity on the European level from the perspective of constitutional jurisprudence. Adenauer largely shared these attitudes, but was much more pragmatic than the academics.

The third conception could be called the economic theory, and was supported mainly by Ludwig Erhard and most officials in the Ministry of Economics. (4) In their eyes, European integration was first and foremost an economic problem that could be solved best through a general liberalization of trade and services among the West European states. These stances were supported by the most important industrial pressure group in the Federal Republic, the Bundesverband der Deutschen Industrie (BDI), and its president Fritz Berg, who himself was a close friend of Adenauer. The chancellor was not opposed to this liberal economic approach, but again was much more pragmatic than the doctrinaire liberals.

Apart from these theory-based conceptions of European integration policy there were numerous other initiatives for European unity furthered by other governmental departments and pressure groups that certainly influenced West German European integration policy at this time. These positions were an important part of the transnational relations between the Federal Republic and its western neighbors, even though they were not based on a common concept and were driven by a highly heterogeneous group of actors. Moreover, these initiatives did not always flow in the same direction. At times, they unfolded independently from each other, other times they were interrelated, and occasionally they were even opposed.

This article deals with the impact of the German economic conception of the “Social Market Economy” (Soziale Marktwirtschaft) on the European policy of the Federal Republic in the 1950s. Clearly, all three conceptual approaches to Europe described above were influenced by the economic system, each, however, in a different way. Therefore, I first outline the historical and theoretical background of this economic concept and then analyze in detail the European thinking of its main proponent, Ludwig Erhard. The second part demonstrates how the “constitutionalists” used the social market economic system for their European concepts. The third section provides an example of nongovernmental transnational actors and their significance for the underlying economic concept of the Federal Republic. Finally, the conclusion sheds a slightly different light on the European policy of the early Federal Republic.

“Soziale Marktwirtschaft”

The concept of “Soziale Marktwirtschaft” originally had been created by Alfred Muller-Armack, one of the leading economists of postwar Germany. In the immediate aftermath of World War II, he developed an economic system in theory that he considered to reconcile the economic freedom of markets with a social balance in society. According to Muller-Armack, the origins of Soziale Marktwirtschaft were threefold: (5) the traditional liberalism developed by John Stuart Mill and Adam Smith; the “ordo-liberalism” of the so-called Freiburg School of economics, advocating a strong state to protect competition against monopolistic tendencies; and a social policy to correct the unintended social inequalities resulting from market competition. Ludwig Erhard, however, gradually narrowed the concept down to the ordo-liberal component by rejecting the social dimension of Muller-Armack’s conception. Indeed, Muller-Armack, who was a close collaborator of the Minister of Economic Affairs in the 1950s, later resigned and claimed that Erhard was the inventor of “Soziale Marktwirtschaft.” (6) This hints at another aspect of this notion. In the election campaign for the Bundestag in 1953, the press and information service of the German government created a new notion of “Soziale Marktwirtschaft” that was rather different from the one Muller-Armack developed: “Five years of hard labor lie behind us, but they were not in vain. The ghost of unemployment has been banned. Three million new jobs were created. Five million people got new housing … It is therefore necessary to secure our peaceful reconstruction and to give our vote to a party standing for Erhard’s Soziale Marktwirtschaft,” a newspaper advertisement proclaimed in September 1953. (7) “Soziale Marktwirtschaft” became almost a propaganda term, standing for the economic success of the early Federal Republic and closely linked to Ludwig Erhard. “Soziale Marktwirtschaft” therefore had a twofold meaning. On the one hand, it was a scientific concept developed by Muller-Armack, and on the other, it was an expression used as political propaganda by the government as a symbol of economic success in the early 1950s.

Ludwig Erhard, Soziale Marktwirtsehaft, and the Integration of Europe

Ludwig Erhard was the most ardent and important opponent in the Adenauer government of any supranational European integration process. Supranational integration had started already with the European Coal and Steel Community (ECSC), which was founded in spring 1951. The six member states (France, the Federal Republic, Italy, Belgium, the Netherlands and Luxemburg) transferred their national competencies concerning the coal and steel sector of the national economy to a supranational High Authority. In a letter to Adenauer in December 1950 Erhard agreed in principle to the ECSC as a “precious contribution to the economic integration of Europe.” (8) In internal discussions within the Ministry of Economy, however, he criticized the new approach to European integration as being dangerous, for two main reasons. (9) First, he was skeptical that the sectoral approach to European integration would not be harmful to the entire economy. A separation of the coal and steel sector from other sectors of the economy would probably cause problems because, in Erhard’s view, the economy of a state had to be treated as a single entity. His second objection was that the institutional construction of the ECSC with the High Authority as the supranational instrument and the Council of Ministers as the representative of the national governments was too complicated to handle. As a consequence, this could lead to economic dirigisme at the European level-to which Erhard was strongly opposed. Despite his skepticism, though, Erhard finally accepted the European Coal and Steel Community. (10)

The main reason for this rather reticent stance and muted internal criticism was Erhard’s lack of his own coherent conception for the integration of Europe at that time. From his point of view, the principal task was the reconstruction of the West German economy under the auspices of a market economy. In theory, he was in favor of integrating the West German economy into the European economy if this would be based on the rules of liberal market economy. The minister for economic affairs was highly skeptical towards the French model of “planification,” a kind of politically guided market economy that required certain institutions as a political framework for liberal markets. This was the reason why he instinctively rejected the supranational approach, but his own concept was not yet sufficiently developed to present a real alternative.

The situation changed after the failure of the European Defense Community and the European Political Community in August 1954. In a September 1954 article for the “Bulletin,” the official newspaper of the West German government’s public relations office, he criticized the supranational political approach to European integration and alluded to another concept of his own for the integration of Europe. According to Erhard, the sensitivity of the European nation states would be the main problem for supranational institutions that restricted national sovereignty. Instead, he favored a political system based on principles “that exert an anonymous influence on the behavior of the nation states.” (11)

European integration, he explained, should be oriented around function, rather than institutions. Europe could be built on existing organizations like the Organization for European Economic Cooperation, GATF or the Bretton Woods institutions for monetary cooperation. These institutions had grown organically and gradually, he opined, they were based on scientific research, and had succeeded in integrating the western economies. Economic liberalization and free currency convertibility would inevitably lead to political solidarity among the nations.

In an internal memorandum drafted in early 1955 and sent to Adenauer and Jean Monnet, Erhard tried to render these thoughts more precisely. Now, he differentiated between two forms of integration–the institutional form and the functional approach. In his definition, institutional integration was the form that required political institutions as a new supranational authority independent from national governments. This kind of integration had been realized in the ECSC, which, according to him, was now highly isolated without any chances of success in the long run. Apart from that, the integration of only one sector of the economy was dangerous for the economic development of Western Europe as a whole, echoing the arguments of 1951. This time, he added another objection to supranational integration: “This kind of institutional integration necessitates the delegation of national sovereignty to a supranational institution and this restricts the economic freedom of national governments … With a multitude of these systems we necessarily reach the point where national economic policy becomes impossible.” (12) Erhard presented himself as a supporter of the “Europe of Nations” (as it was called later), meaning the close cooperation of sovereign Western European governments only in the economic sector.

After this rejection of supranational “institutional” integration he developed his own concept of “functional” integration. This concept aimed at a harmonization of economies by establishing a common set of rules for economic action on the national as well as the international level. In a speech delivered in Paris in December 1954 he explained: “I mean a system that enforces a certain behavior on countries or economies if they want to develop successfully.” (13) The national governments and their economies should accept voluntarily a set of rules that would force their policies in a common direction. The model Erhard had in mind was indeed the international gold standard of the second half of the nineteenth century that had assured unrestricted exchange among the nations that freely accepted gold convertibility. The decisive point was that the international gold standard was based solely on the free will of national governments to respect the rules of the system without any need for a supranational institution. But, functional integration was not restricted to economic integration-it was intended eventually to lead to political unity: “I tend to believe that this kind of functional integration setting common rules … helps us to overcome national rivalries and will lead to unity.” (14)

What were the underlying rules of this functional integration? They were the principles of the liberal market economy for which Erhard had fought in West Germany under the notion of Soziale Marktwirtschaft. He was convinced that this economic system had benefited a totally destroyed Germany and had thereby proven its efficacy. “This given example on the national level,” he explained in Paris, “is likely to become a European value.” (15) Under the auspices of “functional integration,” Erhard thus pleaded for an extension of the German economic system of Soziale Marktwirtschaft to the European level. If all Western governments would accept the rules of the German system which he identified as “strong currency, free competition, solid public finances,” European integration would be accomplished without any unnecessary political institutions. Soziale Marktwirtschaft therefore turned out to be the basis for Erhard’s European commitment.

West German “Institutionalists” and the Economic Structure of the Federal Republic

The second German conception concerning the integration of Europe was supported mainly by diplomats from the Foreign Office. Hallstein and Ophuls were not interested in questions regarding the economic system, but in constitutional law. For them, European integration was not an economic process leading to a common market, but was first of all a political undertaking with the object of establishing a federal European state. This became clear during the 1950 negotiations around the Schuman Plan (16) in Paris, when Hallstein, Professor for Constitutional Law at the University of Frankfurt, pleaded for a federal state after the example of the United States of America: “We planned to unite the Council of Ministers with the Common Assembly to a kind of Congress in the sense of the American public law, with a Senate and a national parliament, that is to become a supranational European Parliament,” is how he described the German position for the constitution of the Coal and Steel Community, (17) The German delegation consequently saw the ECSC as the nucleus of a European federal state. This is easily understandable when we take into account the political situation of the early Federal Republic. It was not a sovereign nation state–integral parts of its national sovereignty were still held by the Western allied occupation forces and the High Commission for Germany. The integration of Germany into a European federal state would mean that Germany would be treated on an equal basis with the other members of the community, especially France, and hereby gain sovereignty. Equality with France was thus the principal aim of the German government in this period. Even though this was a political aim, economic concerns did play a major role. The reason was simply that France and the other partners within the ECSC were not primarily interested in German sovereignty or equality. The only reason for them to accept German membership in the planned community was that they felt the necessity to embed rising German economic and political power in a supranational community. They wanted to make sure that West Germany would never use its overwhelming economic power again, especially in the coal and steel sector, in order to perpetrate another war against its western neighbors. At the beginning of the 1950s, the German coal and steel industry in the Ruhr was just starting to reach its potential and one reason for this success was the establishment of the liberal economic order called Soziale Marktwirtschaft. From this perspective, the economic power of the Federal Republic developed under these auspices was the main reason why the western European governments, especially France, accepted German wishes concerning the “constitution” of the ECSC. In the beginning of the 1950s, Western Germany had no military or political power. It was accepted as an equal partner because of its economic power, especially in the coal and steel sector. Hallstein and Adenauer were, of course, well aware of these facts. Hence, they used the economic power of the Federal Republic as a political argument.

The same pattern of behavior reappeared in the context of the negotiation for the Treaty of Rome, establishing the European Economic Community (EEC) six years later. For Hallstein, the Common Market was another important step towards a political community: “European integration is a necessity for the life of Europe under actual conditions,” he explained to the Foreign Ministers of the ECSC in Noordwijk in September 1955.

According to the “institutionalists” in the German Foreign Office the Common Market was established due to political reasons, mainly to make “Europe” a third world power on equal terms with the United States and the Soviet Union. Apart from that, especially Hallstein saw the EEC as a milestone on the way to a European federal state.

The French perception was again slightly different. Guy Mollet, the French prime minister, was convinced that it was still necessary to tie Germany to the Western Alliance because of its economic power: “If we do not find an instrument to integrate Germany into a European system in the next five years, it will sign a new treaty with the Soviet Union. I do not doubt the European sentiments of its present political leaders, Adenauer and Ollenhauer … But what will happen, if Russia opens its markets to Germany if we do not have a Common European Market?” (19) This is quite the same pattern of thought on the French side as previously in the ECSC negotiations. Germany was accepted as a European partner because of its threatening economic power.

In the context of the establishment of the EEC, another aspect appeared that matters in reference to the relationship between the economic system and the foreign policy of West Germany. One of the preconditions for the acceptance of the EEC Treaty in the French parliament was the establishment of a Common Agricultural Policy (CAP) on the European level that was very much in favor of French farmers. From an economic perspective, the Federal Republic was opposed to the French proposals because it was clear that Germany would gain very little from the CAP while paying a lot for it. Nevertheless, Adenauer and Hallstein accepted the French demands because they wanted to establish the EEC first and foremost out of the aforementioned political reasons and were ready to pay a high price for it. This again was only possible because of the economic strength of the Federal Republic. The same situation reappeared again at the end of the 1960s, when the French government obstructed the enlargement of the EEC in order to get a final financing system for the CAP. Again, this was highly expensive for the German government, but Foreign Minister Willy Brandt told his French counterpart Michel Debre: “The German Government is fully aware of the fact that the agreement concerning agriculture would be very expensive, but it agreed because it wanted to proceed in other fields of integration.” (20) Again, a West German foreign minister used the economic and financial power of the Federal Republic to reach political targets. This was only possible because Soziale Marktwirtschaft at least in the 1950s and 1960s was a very efficient and powerful economic system. The economy was the only sector in which the Federal Republic was accepted as a great power in the international system, but it was a sector of growing significance and the German foreign ministers used this advantage very skillfully to assert political influence as well.

The Transnational Relations of the Federal Republic

Apart from the conceptions of the Foreign Office and the Ministry of Economics, there were numerous contacts between the Federal Republic and other nations in the context of transnational relations. In contrast to the conceptions just mentioned, they were not part of a general theoretical notion of economic or foreign policy. Instead, these transnational relations were the result of the economic order of West Germany–the market economy. One of the core principles of the market economy and also of the concept of Soziale Marktwirtschaft is the freedom of individuals in the markets. All participants in this system have to decide for themselves what to produce or to consume, what to buy or to sell. As a consequence, this leads to an economic system with a decentralized decision-making process in contrast to the political decision-making process in a ministry or a government. Whereas governments at least try to speak with one voice as the result of this centralized decision-making process, participants in a market economy act differently. Sometimes, transnational actors therefore operate in a coordinated manner, sometimes parallel to each other without cooperation, and sometimes also in confrontation with each other. Because of the countless actors in the field of transnational economic policy, countless examples could be given for these activities and all cases are from a certain perspective interchangeable. In this context, only two striking examples of German European policy will be mentioned because they are representative for these transnational relations and their repercussions on government policy.

The first example deals with German international transport policy, especially with inland navigation on the Rhine River. Since ancient times, the Rhine has been one of the most important transportation routes in Western Europe. It is no surprise, therefore, that the first international organization in the modern sense of the word was established at the Congress of Vienna in 1815 for the administration of inland navigation on the Rhine. Even though the Central Commission for Navigation on the Rhine underwent several changes during the 150 years of its existence, it maintained as its central task the guarantee free navigation on the river. All participants in the Central Commission were obliged to admit the passage of ships from other members and to treat them like their own. The members of the Central Commission were the states bordering the river who were jointly responsible for the administration of navigation, technical aspects, as well as social questions, for instance, insuring ship workers. In 1936, Nazi Germany had left the Central Commission for Navigation on the Rhine, but in April 1950 the Federal Republic re-joined the international organization. But, this did not mean that Bonn accepted all of the principles of free Rhine navigation. On 27 June 1953, the Dutch government sent a diplomatic note to the Foreign Office criticizing that despite German and Dutch membership in the Central Commission, the Federal Republic was discriminating against Dutch shipping companies on the Rhine. (21) The background of this complaint was an order by the Joint Export Agency, an economic institution of the Allied forces in Germany of 29 July 1949 that in order to save German foreign exchange, internal German transport on the Rhine should be carried out only by German ship owners. This, of course, discriminated against the Dutch shipping companies, which since 1945 owned by far the biggest fleets on the river, and it also violated the rules established by the Central Commission. After the German re-entry, the Dutch government therefore demanded free access to the German transport market. In contrast, German ship owners were very much in favor of the Allied order because it protected them against strong competition from the Netherlands, a position fully supported by the German Ministry of Transport. (22) The reason for this identity of interests between the ministry and the ship owners was the very close relationship between the head of the inland navigation department, Ursula von Koeppen, and the vested interests of the German companies. The director of the Haniel shipping company in Duisburg was the official representative of the Federal Republic in the Central Commission. The Foreign Office on the other hand, was skeptical towards the attitudes defended by the Ministry of Transport and the ship owners, not for economic reasons or due to the close relationship between public and private interests, but because the conflict between Dutch and German ship owners could be harmful to the general line of foreign policy aiming at the political integration of the Federal Republic into Western Europe, as well as reconciliation also with the Netherlands. The German Secretary of State Walter Hallstein and the Dutch Minister for Foreign Affairs, Josef Luns, therefore agreed not to deal with this conflict at the diplomatic level and to leave the solution to the interest groups on both sides. (23) After April 1953, these groups were organized in the Arbeitsgemeinschaft fur die Rheinschiffahrt, an international organization that assembled the companies of the riparian states engaged in Rhine navigation. In this framework, an agreement was adopted that created a kind of cartel by allocating certain quotas for the transport of goods in Germany to the shipping companies. This case shows that the European policy of the early Federal Republic was not only interested in the liberalization of trade and commerce, as is often asserted. There were certain sectors of the economy in which the Adenauer government was not in favor of a general liberalization. Transport policy, not only concerning inland navigation, but also with regard to railway transport is a good example.

Another case comes from the agricultural sector. On 20 March 1951, French Minister for Agriculture Pierre Pflimlin, invited the governments of all states represented in the Organization for European Economic Cooperation (OEEC) to a conference with the purpose of establishing a common European market for certain agricultural products. (24) This was clearly in the interest of French and Dutch agriculture, which produced growing surpluses in certain commodities and wanted to have free access to the highly protected European markets, namely of West Germany and Great Britain. Again, the Adenauer administration was divided over the question of how to deal with this proposal. From an economic point of view, Erhard in principle favored free trade and pled for a general liberalization of agricultural trade. Adenauer, however, considered the so-called Pflimlin Plan as a good opportunity to foster the process of Franco-German reconciliation that had just begun with the Coal and Steel Community, and as another step toward European political unity. The Ministry of Agriculture, however, was strongly opposed to the French proposals because they would put an end to the protection of West German farmers against French and Dutch competition. (25) When the negotiations for the so-called “Green Pool” were finally opened, the German delegation was led by Andreas Hermes who was at the same time the head of the influential German farmers union, the Deutscher Bauernverband. It was the chancellor himself who had charged him with this mission, first and foremost because of internal controversies within his ruling party, the Christian Democratic Union (CDU). Hermes was a leading representative of the left wing of the CDU, which had to be accommodated in government policy. In spite of the politically oriented guidelines given by the chancellor, Hermes argued very much in favor of the Bauernverband in the “Green Pool” negotiations, refusing the general liberalization of agricultural commodities in principle. This was not the only, but one of several reasons why negotiations for a liberalized European agricultural market failed in the summer of 1954.

Both examples show that economic actors, shipping companies, farmers, and their lobby groups played a considerable role in the making of the West German European policy in the Adenauer era. They were supported by parts of the government–in these cases, the Ministries for Agriculture and Transport. Consequently, there was no German European policy as a whole, but rather a multitude of approaches sometimes supporting each other, sometimes parallel to each other, but also sometimes obstructing each other. What was important for the European policy of the Federal Republic was that these transnational activities were very intense because the liberal economic system not only facilitated, but actively encouraged such activities. Secondly, Adenauer capitalized very skillfully on these activities in order to attain his political purposes and, thus, made these activities a part of his political concept.

Conclusion

What was the significance of the German economic system, Soziale Marktwirtschaft for the European policy of the Federal Republic? For Ludwig Erhard and the leading civil servants in the Ministry of Economics, Soziale Marktwirtschaft was an end in itself. The rapid success of the German economy in the 1950s strengthened Erhard’s self-confidence because he was convinced that the Wirtschaftswunder (economic miracle) was the result of his policies. He believed that this economic order was the best not only for Germany, but also for the rest of Europe and the free world. From this point of view, the integration of Europe meant primarily the liberalization of trade and services among the European states-what Erhard called functional integration. Political intervention and permanent institutions were considered harmful to the smooth development of the economy. Consequently, Erhard was strongly opposed to the supranational integration in the framework of the ECSC and the Common Market. Instead, he supported the British proposals for a European Free Trade Area in 1956. Even though he did not fully succeed, the liberal economic thinking of the German minister for economy strongly influenced the Treaty of Rome establishing the Common Market. The customs union, which was the core of the Common Market project, was influenced especially by the German Ministry of Economics.

In contrast to Erhard, the “institutionalists” in the Foreign Office were not primarily interested in the establishment of a liberal economic order in Western Europe, even though they were not opposed to it in principle. For Hallstein, the economic strength of the Federal Republic was an instrument for diplomacy. Germany had lost its status as a political and military power, but had regained much of its economic strength. Hallstein used this as a means to assert German political interests, especially to achieve international equality with France and the other Western European states. Consequently, the market economy for them was no end in itself, but a useful instrument to assert certain political interests.

Nongovernmental actors also played a considerable role in German European policy in the 1950s, but in a non-coordinated manner, sometimes with the support of parts of the government, sometimes in opposition to it. For private enterprises, the market economy was given, but not an end in itself. They were interested primarily in making profits and for that purpose they acted internationally. According to their interests, they sometimes fought for a liberalization of trade and services, as did for instance the Bundesverband der Deutschen Industrie. Other times they obstructed the establishment of a common international market, as for example the Deutscher Bauernverband or the Rhine shipping companies. Yet, their manifold aims notwithstanding, they were part of the European policy of the Federal Republic because they had the support of parts of the government. They gained even more influence especially when leaders of lobby groups, like Andreas Hermes (Deutscher Bauernverband) and W.D. Ahlers (Haniel shipping company), became the heads of official delegations in intergovernmental negotiations.

Because of all these divergent and sometimes contradictory activities in German European policy, one could easily draw the conclusion that there was no coherent foreign policy in the Federal Republic in the beginning of the 1950s. This again would be an exaggeration. As a matter of fact, Baring’s dictum quoted at the beginning of this article is still valid. Konrad Adenauer was the dominant actor in the early Federal Republic, especially in the realm of foreign and European policy. This was due to his personality, but was also a consequence of the political system, the so called Kanzlerdemokratie that gave the office of the chancellor a privileged influence in the decision-making process. Adenauer’s position was also strengthened by his pragmatism. His principle aim was reconciliation with France and the integration of Western Germany into the Western world through strong ties with the United States. To reach these aims, he was ready to cooperate with the institutionalists as well as the functionalists and also used the activities of transnational actors if they were in line with his vision. As a result, there was an equilibrium between the economic freedom guaranteed by the system of the market economy on the one hand, and the political system assuring social stability, on the other.

Guido Thiemeyer

History, Universitat Siegen

Notes

(1.) Arnulf Baring, Ira Anfang war Adenauer: Die Entstehung der Kanzlerdemokratie (Munich, 1984).

(2.) Hans-Peter Schwarz, Adenauer: Der Aufstieg (Stuttgart, 1988); Hans-Peter Schwarz, Adenauer: Der Staatsmann (Stuttgart, 1991). More critical towards Adenauer is Henning Kohler, Adenauer: Einepolitische Biographic (Berlin, 1994).

(3.) Wilfried Loth, ed., Walter Hallstein: The Forgotten European? (Bonn, 1995).

(4.) Ulrich Lappenkuper, “‘Ich bin wirklich ein guter Europaier:’ Ludwig Erhards Europapolitik 1949-1966,” Francia, 18, no. 3 (1991): 85-121. Guido Thiemeyer, “Gemeinwohlkonzeptionen in der Grundungsphase der EWG 1950-1957,” in Europaisches Gemeinwohl: Historische Dimension und aktuelle Bedeutung, eds., Gerold Ambrosius and Peter Schmitt-Egner (Baden Baden, 2006), 81-98.

(5.) Alfred Muller Armack, “Soziale Marktwirtschaft,” Handworterbuch der Sozialwissenschaften, vol. 9 (Stuttgart, Tubingen, Gottingen, 1956), 390-392. Alfred Muller Armack, “Stil und Ordnung der Sozialen Marktwirtschaft,” in Wirtchaftsordnung und Wirtschaftspolitik: Studien und Konzepte zur Sozialen Marktwirtschaft und zur Europaischen Integration, ed., Alfred Muller Armack (Freiburg, 1966), 231-242.

(6.) Muller-Armack, “Stil und Ordnung,” (see note 5), 232.

(7.) “Wohlstand aus eigener Kraft”, Rhein-Neckar Zeitung, 5 September 1953, quoted by Rolf Steininger, Deutsche Geschichte seit 1945, Vol. 2: 1948-I955 (Frankfurt, 1997), 140/141.

(8.) Bundesminister fur Wirtschaft (Erhard) to Adenauer, 11 December 1950, Bundesarchiv Koblenz, B 136 (Bundeskanzleramt), Bd. 2474.

(9.) RolfLahr, Zeuge von Fall und Aufstieg (Hamburg, 1981).

(10.) Volker Hentschel, Ludwig Erhard: Ein Politikerleben (Landsberg, 1996), 124-130.

(11.) “Ich habe erklart, dass bei den nationalen Empfindlichkeiten der europaischen Staaten und einer gewiss falsch verstandenen Vorstellung von Souveranitat jede Instanz problematisch erscheint, die die eigene, nationale Entscheidungsfreiheit einschrankt, und dass es darum darauf ankame, Prinzipien zu setzen, die aus dem Ordnungssystem heraus einen sozusagen anonymen Zwang auf das Verhalten der Nationalstaaten ausuben.” Ludwig Erhard, “Nach dem Scheitern der Europaischen Verteidigungsgemeinschaft,” Bulletin, 22 September 1954. Reprint in: Ludwig Erhard, Deutsche Wirtschaftspolitik: Der Weg der Sozialen Marktwirtschaft (Dusseldorf, 1992), 245-252.

(12.) “Mit dieser Art der institutionellen Integration ist zwanglaufig verbunden eine Delegierung nationaler souveraner Zustandigkeiten an eine supranationale Behorde und damit indirekt eine Einengung der wirtschafts- und konjunkturpolitischen Gestaltungsmoglichkeiten seitens der beteiligten Staaten … Bei einer Haufung solcher Systeme … musste zwangslaufig jener kritische Punkt erreicht werden, der die einzelnen Nationalstaaten der Moglichkeit einer eigenen Wirtschaftspolitik beraubt … Ludwig Erhard, Gedanken zu dem Problem der Kooperation oder Integration, Private Studie, Bundesarchiv Koblenz BA 136, Bd. 1310.

(13.) “Ich meine ein System, das aus seinem inneren Ordnungsgefuge heraus ein bestimmtes Verhalten der einzelnen Lander und Volkswirtschaften gewissermassen erzwingt, wenn und solange die einzelnen Volkswirtschaften innerhalb dieser Ordnung eine gluckliche Entwicklung nehmen wollen.” Ludwig Erhard, “Europaische Einigung dutch funktionale Integration: Rede vor dem Club ‘Les Echos’ in Paris, 7 December 1954,” Ludwig Erhard (see note 11), 253 259, quoted here 257.

(14.) “Ich mochte glauben, dass diese Art von funktioneller Integration, die gemeinsame Spielregeln setzt und mit deren notwendiger Befolgung eine gewollte Wirkung erzielt, uns wahrscheinlich rascher weiterhilft, die Sentiments und Ressentiments auf der nationalen Ebene zu uberwinden und uns zu einer Einheit, einem gemeinsamen Ziel und zu einem gemeinsamen Erfolg hinzufuhren.” Ibid., 257.

(15.) “Der hier gelieferte Experimentalbeweis kann zu einem europaischen Wert werden.” Ibid., 255.

(16.) Andreas Wilkens, ed., Le Plan Schuman dans l Histoire: Interets nationaux et projet europeen (Brussels, 2004). See also Gilbert Trausch, “Der Schuman-Plan zwischen Mythos und Realitat: Der Stellenwert des Schuman-Planes,” in Europa im Blick der Historiker, eds., Rainer Hudemann, Hartmut Kaelble, and Klaus Schwabe (Munich, 1995), 31-54. Historische Zeitschrift, Beihefte NF vol. 21.

(17.) “Wir haben dabei daran gedacht, den Ministerrat mit der Assemblee Commune zu einer Art Kongress im Sinne des amerikanischen Staatsrechts zusammenzufassen, bestehend aus einem Staatenhaus und einem nationalen Parlament, also hier einem supranationalen europaischen Parlament …” Akten zur Auswartigen Politik der Bundesrepublik Deutschland (AAPD), 1949/1950 (Munich, 1997), Doc. No. 99: Besprechung beim Vorsitzenden der Konferenz uber den Schuman-Plan, Monnet, in Paris, 27 July 1950, 283.

(18.) “Die Europaische Einigung ist Ausdruck der Lebensnotwendigkeit Europas unter den gegenwartigen Verhaltnissen. Europa kann politisch und wirtschaftlich nur leben, wenn es sich einigt. Eine der Tatsachen, die uns wesentlich erscheint zur politischen, wirtschaftlichen und kulturellen Selbstbehauptung Europas, ist die Schaffung Europas als einer handlungsfahigen Grosse im Konzert der weltpolitischen Stimmung. Insbesondere hat sich ein zentraler Begriff verdeudicht und in seiner beherrschenden Rolle fur die gesamte Arbeit herausgestellt: der Begriff des Gemeinsamen Marktes. Dieser ist der wirtschaftliche Ausdruck unseres politischen Entschlusses.” Politisches Archiv des Auswartigen Amtes, Berlin, Abt. 2, AZ 225-10-02, vol. 903, Entwurf der Rede Hallsteins in Noordwijk, 6.9.1955.

(19.) “Wenn wir in den nachsten funf Jahren kein Mittel gefunden haben, Deutschland in ein europaisches System zu integrieren, dann wird es von neuem einen deutsch-sowjetischen Pakt unterzeichnen. Die europaischen Gefuhle seiner augenblicklichen Fuhrer, Dr. Adenauer und Ollenhauer, stelle ich nicht in Zweifel … Aber was geschieht an dem Tag, an dem Russland Deutschland Absatzgebiete offnen wird, wenn wir bis dahin keinen gemeinsamen europaischen Markt haben?” Bundesarchiv Koblenz, B136 Bd. 3624-1, Le Figaro, 15.12.1955, German Translation.

(20.) “Der deutschen Regierung sei klar, dass die getroffenen Vereinbarungen im Bereich der Landwirtschaft mehr kosten als dabei hereinkomme; sie mache aber mit, weil sie auch auf anderen Gebieten weiterkommen wolle.” AAPD, 1968, vol. 2 (Munich, 1999), Doc. No. 287, Gesprach des Bundesministers Brandt mit dem franzosischen Aussenminister Debre in Paris, 7 September 1968.

(21.) Politisches Archiv des Auswartigen Amtes Berlin (PAAA), B81 (Binnenwasserstrassenrecht), vol. 31, Verbalnote der Koniglich-Niederlandischen Regierung an das Auswartige Amt vom 27 July 1953.

(22.) “Die Hollander beabsichtigen, durch ihren Notenwechsel den Einbruch in den deutschen Binnenschiffahrtsverkehr auf dem Rhein zu erzwingen, um der niederlandischen Wirtschaft neue Ertragsquellen zu erschliessen … Die niederlandische Rechtsauffassung soil vor allem den Kampf um die niederlandische Vormacht in der Rheinschiffahrt tarnen. Sie ist nichts anderes als die Fortsetzung der bisherigen niederlandischen Kampfmassnahmen gegen die dentsche Rheinschiffahrt.” PAAA B81 (Binnenwasserstrassenrecht), vol. 33, Aufzeichnung. Kurzauszug aus dem Memorandum des Verkehrsministeriums tiber die deutschniederlandische Rheinschiffahrtsfrage, 17 November 1953.

(23.) PAAA B81 (Binnenwasserstrassenrecht), vol. 33, Seiermann (BMV) an Auswartiges Amt, betr. Internationale Rheinschiffahrt, 27 November 1953.

(24.) Guido Thiemeyer, Vom “Pool Vert” zur Europaischen Wirtschaftsgemeinschaft: Europaische Integration, Kalter Krieg und die Anfange der gemeinsamen europaischen Agrarpolitik (Munich, 1999).

(25.) Werner Buhrer, “Agricultural Pressure Groups and International Politics: The German Example,” in The Green Pool and the Origins of the Common Agricultural Policy, eds., Richard Griffiths and Brian Girvin (London, 1995), 77-90.

DR. GUIDO THIEMEYER is Assistant Professor (Hochschuldozent) of European Studies at the University of Kassel, Germany. He has published extensively on aspects of European integration after World War II, especially the Common Agricultural Policy and European Monetary Integration. His most recent work is a comprehensive analysis of European monetary cooperation in the second half of the 19th Century (forthcoming).

Thiemeyer, Guido